Dealing Range

Also: Dealing Ranges · Daily Dealing Range

Definition

A dealing range is the most recent qualified swing high to swing low (or low to high) that defines where the algorithm is currently delivering price. It establishes the operative [[Premium and Discount]] boundaries and provides the framework within which PD arrays are evaluated. The market always works inside a dealing range.

Key characteristics

• Defined by a qualified swing high and swing low with valid internal structure
• 50% of the range is [[Mean Threshold]] / equilibrium
• Above equilibrium = premium (short-bias zone)
• Below equilibrium = discount (long-bias zone)
• Exists on every timeframe — nested ranges inside ranges
• Remains the operative range until a new swing point qualifies outside it

How it forms

A swing high forms when price fails to make a higher high on two sides of a candle; a swing low is the inverse. Once both exist and price is rotating between them, that high-to-low pair becomes the active dealing range. New extremes outside this range invalidate the old one and establish a new one.

How to use

Use the dealing range to decide direction: look long only in discount, short only in premium. Use it to qualify PD arrays — a bullish OB in premium is low-quality; the same OB in discount is high-quality. Use it to set targets — opposite extreme or equilibrium. The dealing range is the filter that stops you from taking premium-discount-violating trades.

Common mistakes

• Using a dealing range that has already been invalidated by a new swing extreme
• Ignoring HTF range in favor of LTF range — HTF bias rules
• Buying in premium or selling in discount — the range's entire purpose is to prevent this

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