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Dealing Range Theory

The document introduces Dealing Range Theory (DRT), which grades price levels on various charts from 1.00 (highest) to 0.00 (lowest), with 0.50 representing the equilibrium or fair value. It explains market behavior around these levels, emphasizing the movement between premium and discount markets, and the importance of liquidity on both sides. Additionally, it highlights the significance of analyzing price direction and candle patterns in relation to DRT for market insights.

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clemoskiiadrian
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351 views3 pages

Dealing Range Theory

The document introduces Dealing Range Theory (DRT), which grades price levels on various charts from 1.00 (highest) to 0.00 (lowest), with 0.50 representing the equilibrium or fair value. It explains market behavior around these levels, emphasizing the movement between premium and discount markets, and the importance of liquidity on both sides. Additionally, it highlights the significance of analyzing price direction and candle patterns in relation to DRT for market insights.

Uploaded by

clemoskiiadrian
Copyright
© © All Rights Reserved
We take content rights seriously. If you suspect this is your content, claim it here.
Available Formats
Download as PDF, TXT or read online on Scribd
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INTRODUCTION TO DEALING RANGE THEORY (DRT)

On the monthly/weekly/daily/4H chart, grade the chart into levels.Namely:

●​ 1.00(Highest Price Level)


●​ 0.75
●​ 0.50
●​ 0.25
●​ 0.00(Lowest Price Level)

The 0.50 DRT Level is the equilibrium level.It is referred to as fair value/mid price since its
between 1.00 DRT Level and 0.00 DRT Level.

The market tends:


●​ Gravitate towards the equilibrium(0.50) since it is fair value.
●​ Reprice old highs & lows to seek liquidity
●​ Rebalance price inefficiencies

Above equilibrium there are two things:


1.​ Premium Market
2.​ Discount Market

In premium market there is premium (0.75 DRT Level) and extreme premium (1.00 DRT Level)
In discount market there is discount (0.25 DRT Level) and extreme discount (0.00 DRT Level).
These individual grade levels can be further be subdivided into premium and discount.
The market moves from premium to discount and vice versa..Study how the market moves from
premium to discount and vice versa to gain insightful knowledge.

A valid dealing range has to raid both sell side and buy side liquidity.

Take note on how the dealing range was formed.Where has price come from and the direction it
is likely to take.

Study on Dxy(US Dollars) Monthly Timeframe;Dealing Range Theory DRT

In an uptrend , we want to see downclosed/bearish candles support price (Bullish Orderblocks)


and in a downtrend , we want to see up closed/bullish candles support price.(Bearish
Orderblocks).

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