All language subtitles for 7 Premium vs Discount Walkthrough

right okay hopefully you have saved down uh this template right you have drawn

your annotations on here from the previous uh basic market structure

walkthrough and you have your four hour swing points on at a minimum drawn on uh

potentially you will still have your minor breaker structure right and your

change of characters there as well but ideally you have your four hour swing

structure mark mapped out now what i want you to do just solely

for the premium discount lesson is i want you to go up to the right hand

corner to your current saved template and i just want you to make a copy so

what this essentially will do is just duplicate all of the drawings that you

have done and then you know call it whatever you want in this case i'm just

going to call it premium versus discount just because we need to have a separate

um chart saved down so it may take a little while to do that

for um

just for the purpose of premium versus discount whilst we do this because we're

going to be drawing obviously the tools across the charts and it can get a

little bit messy so as we go throughout throughout the rest of the course and we

start to build on more concepts what i want us to do is to use our initial

right the one that we were first using this initial layout to build on those

concepts but just now whilst we really dig into premium discount um yeah the

charts getting a little bit messy so i just want to keep it to a separate one

here so then when we go back to our original one um you know we can build on

this and it won't get you know kind of overwhelming and confusing if that makes

sense so yeah this will kind of be our sort of

practice arena for playing around with premium and discount here so what i'm

going to do is just go through you know the price action that we've done so far

this should be you know a lot quicker than having to actually go through you

know each bit of price action and map out your structure because now we

already have our swing points so literally all we are going to be doing

is drawing our premium discount right between those swing points so

if you have uh that premium and discount tool saved gonna briefly go over it uh

in the the theory video but essentially what you want to have if you haven't

already is have this fair retracement tool which you can go over here and save

it down to your favorites toolbar and then yeah you should

be able to have something looking like this right so what we do when we are

bearish right because we're looking at these lower lows and low highs is you

can draw it from uh the high to the low and then you can see where we have the

premium and discount now there's a few ways you can kind of

do this in the live market uh now ignore the colors here it doesn't really matter

which way you have them round right it's just kind of whatever makes sense to you

right but yeah the way i was saying in terms of which way you would draw it is

in the live market right imagine we don't have all of this price action yet

but you would just you know price was down here and you're anticipating

potentially where price is going to pull back if you can just have it on the

swing leg right rather than having it drawn the whole way across because you

know as you start to have more concepts and more analysis tools drawn on your

charts and you're flicking through multiple time frames it can get very

very confusing when you have all of these colors and shades everywhere so i

wouldn't really advise that you kind of do that in the live market so i would do

something like that or what can be even better is you can just hold shift when

you drag it across so it doesn't move if you hold shift right and then just have

it drawn off to the side here so this whole time you can focus on price action

and you can see where we are within the leg right whether in the premium or the

discount um and that way it just yeah it will become a lot easier

but for now i keep it even more uh minimalized than that so i have it i

just have it there saved as a range um and essentially that way you know i

don't really care about what colors sometimes you can hear and i'm drawing

it the wrong way around but essentially all i care about is where is the eq i

know that that's the 50 right from the swing high to the swing

low so anywhere above the eq is always going

to be the premium right no matter whether it's bearish or bullish the top

part is always expensive right the higher the price that's the premium the

lower the price that's the discount right so that way you know you don't end

up getting your colors mixed up if you kind of had those

shades there so yeah really simple tool right we're in this bearish trend we get

that four hour break of structure what do we expect after for our breakup

structure we expect a pullback how do we know when that pullback is going to kick

in when we're purely just looking at market structure what we expect

that to be that change of character right to give us that minor breaker

structure to the upside which is what we get here which then shows us that the

swing run may be over and that pullback is kicking in and then how do we know

when that pullback is going to be over we look for then another

minor break of structure to the downside where we get that change of character

here and we then switch bearish right and then that gives us that sign that we

get that next leg down so that's what you know the way we were

anticipating those swing moves purely just looking at basic market structure

on one time frame alone now we have introduced um you know one more concept

which is of course premium versus discount just to help us

you know increase the probability of when that pullback may be over so when

we see that you know the pullback starting to kick in and we get that

change of character then we can kind of start to mark with a bit more confidence

where that swing low likely uh is right and then that's when we can draw on our

premium versus discount tool all right and now what we can see price

pretty much comes back up to the eq right of course it doesn't quite tap it

and misses it here by a few pips but if you see price coming up here it's pretty

much mitigated the eq of the leg right we pretty much come back to fair value

for buyers and sellers we then get our change of character back to the downside

all right now you have that extra piece of confidence that extra piece of

evidence and that you're now building to build you know a more high probability

trade idea right and then what we can do is position ourselves short we're now

pro the four hour trend and we can look to target that weak low at a minimum

right because that low never took out the swing high so we expect this low to

be taken and we get our breaker structure so that's literally as simple

as it needs to be um yeah one last point i kind of make about this blue price

action is you know the market is is imperfect right we're not always going

to get those picture perfect pullbacks to the eq or all the way into the

premium um you kind of just have to to just you know use it as a spectrum of

probabilities and obviously the higher up it goes you know the better it is for

us to be getting into shorts but you're gonna the whole point of this exercise

is to see sometimes it will pull back to the eq

sometimes it will pull heavily into the premium when you're looking for shorts

sometimes we'll only pull the pull back a little bit and it will go so

the whole point of this is to collect data see how often it does pull back uh

see when it doesn't pull back it's going to make this a little bit more dim

because it's already annoying me um

yeah see how often it will pull back and then yeah we can start to collect data

and get a bit more experience because if you're always waiting for price to come

up into the premium sometimes you're going to miss moves and that's okay

right it's just going to be dependent on each

individual trader how aggressive or how conservative

you know you want to be but this will just really give you a good

understanding of you know how likely it is and not overall price is going to

pull back but anyway we get that next bearish leg right now we start to get

that pull back down here so we can mark out um the new range that we are within

and as we can see after four hour break of structure we get that minor breaker

structure to the upside that change of characters to show the pullback's

kicking in and we pull back up into the premium right then we start to get

changes of character again uh back to the downside down here right showing us

that potentially the that is the lower high in place we've mitigated the the

premium right the eq and now we're ready to go and run this week low okay

so let's speed this up a little bit and draw on our next range so that swing

highs all the way up here um all the way down to this low here for me obviously

we get a very very shallow pullback there

some of you may not classify that as a swing pack swing pull back that's okay

but again just remember to be consistent then we are within the swing range here

now of course at this point we do pull back um up into the premium so you can

see setters start to step in already but this case right buyers keep stepping

back in we've had a minor breaking structure there we've had another minor

break of structure we are now in the premium remember we spoke about this and

then you know we still at this point purely just looking at market structure

and one single time frame right forgetting everything else we just

assume that this lower high will hold until it doesn't so when price is in

premium prices of this four hour swing range right then we get that bearish

change of character back in line with the oval swing trend what do we expect

we expect that potentially we can target this slow right but of course we're

playing with probabilities we end up getting another change of character to

the upside and then we run that high and we get a higher highs and then we are in

the bullish trend right and then we wait for our swing pullback so in this case

we can then mark out from the swing low to the swing high and now because we are

bullish ideally we want to be buying back down here right in the cheap prices

in the discount but like i said playing with probabilities it's not always going

to work out the price is going to come back that deep

now one thing you notice um and again this

is something you'll have to get experience with and test is that you

want to be asking yourselves uh you know what commonalities am i seeing when

price is not pulling back anywhere to you know the the the discount if it's

bullish or the premium if it's bearish and try and spot those things so you can

anticipate uh you know when to expect the price isn't going to pull back that

deep now one of kind of the the things you may notice is that the start

of new trends right in this case we have a nice big impulsive move right the

momentum is very high obviously buyers are stepping in because they really like

this area how often does price then pull back to

the to to the discount or to the premium of a bearish right and that may be

something that you know you want to take note of and record um you know the start

of those new trends how often you know is it likely that price is going to pull

back when we're kind of getting a lot of high momentum um at the start of the new

trend okay so then we are stuck within this new range

here and this time we can see right we did come um you know back into the the

discount of the leg right and then that comes down to cheap prices for buyers

and that gives us the fuel to then go up to the next move now in this case you

can see we didn't come back to the eq right um now

one one other kind of thing i'll say is again getting a little bit ahead of

myself here but as we go through the course and of course

through the course of course as we go through the course we are gonna learn uh

you know more concepts and more tools that are going to help you as well to

identify and you'll see what is forming on price action then suddenly you'll see

actually you know it's not looking likely now price will come back to the

premium sorry back to the discount if you're getting long because you know

like i was saying right it's going to depend on each individual trader

kind of how conservative or aggressive you will be and some of you may only

want to trade pro training for example and some of you may only want to look to

buy when price comes down into the discount right and there's absolutely

nothing wrong with that in fact you know i would advise that for a lot of you

even when you're starting out because that is going to give you your highest

possibility of having that higher strike rate okay

um but as you go on you will you will learn concepts such as you know

liquidity concepts and supply and demand right that is going to

increase your profit or um increase the probability of buying in

a premium right so in this case all right we are playing in this swing

range right we mark out the eq ideally we want price to come back down to here

but if you see certain things and ticks and boxes are ticked in your trade plan

that occur and when we look at liquidity sweeps when we look at where there is

supply and demand and you see that happen then you can go okay

it's not ideal that i'll be buying here like looking to buy here in the premium

and i could be a bit early and we could come down lower but actually i've seen x

y and zed of these other concepts we're about to learn and that's okay so now

that has stacked probability enough in my favor to be happy buying in the

premium okay so that's why you know you have to take everything as a whole and

we're always looking to build that portfolio of evidence to start to tick

tick to start to tip those those probability scales in our

favor as much as possible okay so the reason why i'm kind of getting a

little bit ahead of myself here and talking about other concepts that we

haven't um looked at or or really want to be thinking about just yet it's just

because some of you may be going through this and you're going you know how

useful is this tool is it really worth it you know it maybe doesn't pull back

that often but as we start to bring in those other things especially when we

look at multi-time frame analysis as well

which we'll get into in a bit right and then we have to look at the premium

discounts of multiple time frames that is when it becomes very very powerful

and you'll see then how useful but simple this tool um yeah really is so

anyway let's just kind of quickly go through the rest of these and yeah we'll

just kind of finish it off so in this case we do come back to the deq we come

down into discount prices and then buy step in to fuel that next move to the

upside uh this time just about miss it or do we come to it yeah pretty much the

eq right again not going to be picture perfect but i would pretty much count

that and that's coming back down to the discount prices there for me personally

and then in this case of course we do come back down to the discount prices

but it ends up being a full-on reversal so now we are bearish we might from the

high down to the low okay and then we look for price to come back up

yeah that's you know reasonably close it's not ideal i you know we were

looking for that short we would want to try and see if pricing can come up but

remember what i said you want to be looking at how often when we get that

first initial trend change right collect the stats on this do the hard work how

often on the pair that you are interested in so in this case you're a

dollar right how often on that first initial trend change does price pull

back to the premium if we're short right or to the discount over long um and yeah

and you'll see sometimes we do and sometimes we don't

then we're in this next swing range here of course we do pull back up to the

premium but it ends up being another reversal as that bearish for our trend

is short-lived so now we can mark the high

to the the swing uh sorry to swing low to the swing high right now we have our

for our break of structure what to expect we expect a four-hour pullback

how can we anticipate that that swing run is over and the for our pullback is

kicking in well we can look at internal brakes of structure so we don't get a

minor breaker structure uh really until potentially down here but even then we

barely take it we just about wick it because all of these candles here right

they all break the prior candles high so that's all part of the up move so

there's nothing in this leg on the for our leg for price to break in terms of

minor breaks of structure all we really get

remember we spoke about this before is this substructure low right because we

come down and then we take out that low there so substructure low is the most

aggressive but we get one there and then we get another one here potentially when

you see just the first one or potentially the second substructure

break that may be enough for you to want to

look to take shorts so where can we target well let's say we've gotten short

here first minimum target can be that weak low right because you expect it to

get run um next target can be down towards the eq of the range or you know

further down into the discount then we then when we are into the discount right

we know that this is a good time to start looking for that potential high

low right we know we're in good areas of value for buyers to step in

what can we look for to give us an indication that that higher loan may

have now formed to give us more confirmation we look for a change of

character to the upside right we look for that breakup structure so we have a

minor pullback we then take that minor low because we take a low right this low

here what does that mean it means we must have a minor height that is where

our minor high is so then we take the high we pull back in and then we go

right so it's the same thing again and again using those changes of character

those internal uh breaks of structure to signify when the swing one is over

and when the pullback starting and then when the pullback may be over and the

next thing run is starting but now we're overlaying premium disk premium discount

to give us that little extra edge to show us where we are in good areas of

value okay so you can start to see now how these pieces of the puzzle are

slowly coming together so in this case we don't come down to the eq right and

we continue to go up and then here all right we do if we can get it to draw on

we do come down to below the the

the eq we are in discount prices we could be looking for loans from here but

it ends up turning into a bearish reversal so we mark up the low to the

high and in this case right we do we get that trend change now this is the case

but it is the first initial trend change but we do pull back up into the premium

so remember the first one we looked at here we got that first initial bullish

trend change right price didn't come back down

then we got that first initial bearish trend change here price didn't

technically make it right it came up to a decent area of value but not quite

into the eq and the premium right which is ideally what we want to see

um then we do get the first initial trend change again here but we do come

back this time right but if you're looking at kind of the long-term trend

um you know it's quite later on in that initial trend so you know that's

probably why actually it does pull back right because we are starting to run out

of steam and that's why we only get another couple breaks of structure and

then we get that initial trend change right so now the longer term trend is

starting to end but in this case we do actually pull

back up to the premium we get that nice um you know premium prices to be looking

to sell for how do we know now that the lower high may be forming we get a

change of characters of downside right and we push down and now this is when

you can even use the premium versus discount on those internal legs right

because what happens price pushes down now you have a bit more confidence that

lower high is going to form why because we're in the premium prices of the swing

leg we've had a change of character to the downside with that minor break of

structure here so we've moved down we don't just want to jump in cells

straight away so what can we do we can mark out the internal leg right we wait

for price to pull back up to form that lower high comes back into the premium

prices of the internal deck but also in the premium prices right of the swing

leg that's now a high probability to look at

a minimum target of this swing low here with the potential you can be in the

long term bearish trend change right so you can really see hopefully now how

this is all starting to piece together new swing range here again come up into

the premium what do we get lower high forming in the premium change

your character to the downside we can mark the internal leg what do we do we

pull back up into the premium of the internal leg we have to get short target

that weak low right as a minimum again and again and again just adding these

sort of layers of uh you know analysis to help us right this time we don't

quite make it really cute but not quite so technically

not a valid pullback to in terms of just you know trying to uh count the stats

here right of whether it does pull back to to pass the eq or not okay so

although i said it's not valid in terms of that of course you can still look to

take these trades and this is what i mean right you're just gonna have to

work out um you know are you gonna be happy to sell

in those lower prices right are you gonna be happy to sell on the discount

there are gonna be times plenty of times where you still get massive risk to

reward okay so this is what you're gonna have to figure out yourself and collect

those stats and see what makes the most sense to you so again we have massive

massive momentum here this we have to where you have to kind of ask yourself

um theoretically what is the likelihood

with that amount of momentum that we are going to get a steep enough pullback

right where buyers are going to want to wait for those premium prices or because

there's so much momentum actually you know you know what

sellers just want to step in right they don't they don't care for price to come

all the way back up here the trend is so strong they want to get them short and

price only has to pull back a little bit right buyers cannot generate enough

demands right to push price up higher and then we get those trades short right

so when you see a lot of momentum all right and then we get that change of

character the downside um you know maybe that's enough for you to then look to

want to get short and you're happy to sell within the discount prices of this

four-hour leg right then we are within the swing low to the

swing high what do we do pull back up into the premium and then that is enough

for sellers to step in again and then we start to kind of fall a little bit more

correctively now right pull back up into the premium prices and then we fall back

down again all right almost there

draw from the low to the high up into the premium prices and then we sell off

then of course in this case we do come up to the premium prices don't actually

draw on so it's to the swing low there and we pull back up into the payment

prices don't know why i haven't got my little circle on there we go um so we do

try to sell off when we get to the premium right and we try to go down

remember we spoke about this this is when buyers keep stepping in you can see

those big wicks right they're just stopping the sellers from driving price

any lower we then start to get those internal uh it breaks the ups alright

multiple in a row you can see those higher lows starting to hold showing you

that the buyers are starting to potentially take control and then we do

get that initial four-hour trend change so at that point we are bullish we draw

from the low to the high right um and we can then look to potentially

short back down into those discount prices right because we get that first

initial change of character that first mono breaker structure we get another

one another one another one showing you you know that bearish order flow

starting to kick in and we can look to target the eq but in this case price

ends up going lower and we do get a full-on reversal so now we are bearish

again and we draw from the high to the low all right

what can we do we what do we expect after a four-hour

break of structure we expect a four-hour pullback how do we know that four-hour

pullback is about to kick in we can look for a change of character so where do we

get that we get the minor low the minor pullback we take the minor low because

we took a low that means there must be a high that is a high there price then

takes that it gives us our minor break of structure right because we break the

high the minor high within that swing leg so that gives us our change of

character so then what can we look to do we can then mark the internal leg right

we can wait for price and then pull back into the discount of this internal

leg right this internal structure then we can look to buy that internal high

low to do what to target the four-hour pullback back up into premium prices

right so you can see it just misses it by a few pips but again you know this is

where you have to decide whether or not that's still okay for you that's you

know high enough probability to still look for shorts to then take this to the

downside yeah and then we don't get a minor breaker structure you know another

kind of change of character really until down around here right but you know you

can look at the substructure breaks and so on and so forth and of course we'll

be using multi-time frame analysis as we go on and then we get another breaker

structure so now at this point we can mark out the low to

the higher to the lower right and then we can expect potential price to pull

back up to those premium prices again okay so

yeah hopefully that's you know it's a reasonably simple tool but it can be

very very powerful especially when we start to build on this more with more

concepts um yeah we can really kind of piece the puzzles together so obviously

go back through the the spring structure that hopefully you should have marked on

your charts and draw all of these on and what i would also recommend if you

haven't done so already with your swing structure is go further back collect as

much data as possible you know i believe on on

this forex.com data feed the four hour chart goes all the way back to uh

2013 right so you can get you know over 10 years of data there not over just

under 10 years of data um you know on the four-hour chart it probably won't

actually take you as long as you think um but you know

literally if you're a dollar is going to be the pair that you want to concentrate

on or whatever pair it is you know it's only going to take a few

hours put some music on enjoy it see it as an investment as you know for your

future self right take this seriously right this is a professional

business collect the data do the work and then when you have that data you've

proved it to your mind right you've gone in then you've done the hard work and

you have the hard cold data to back it up of how often

price will pull back to the discount prices in a bullish trend and how often

price will pull back up to the premium prices in a bearish trend and you know

that okay on your dollar on the four-hour chart it does that x

percentage amount of times then you have so much confidence in the market because

if you're seeing this move here right and you're looking to get long you can

know maybe at the start of trends how often it does pull back and how often it

doesn't and rather than you waiting you'll have then conviction um you know

maybe you want to see a few few more other things to to you know build that

portfolio of evidence then you're happy to get in long hair because you know

over x amount of years of data whether that be two three four five ten years

however much you do you will know with x percentage probability you know how

likely that move is going to continue right so that is going to do wonders for

your psychology right because if your goal is to be a professional trader and

you want to trade six seven eight you know nine ten whatever figures right

the higher you go with that account capital the more psychological issues

you are potentially going to run into but if you have cold hard mechanical

data to back that up right you're going to give yourself that highest

probability of you know having success and not

sabotaging yourself and you know having those ifs and doubts because you've done

the hard work now you've collected that kind of data and you can look at your

spreadsheet you can look at your trade plan wherever you're going to record it

and you have that percentage figure staring back at you

and you can use that with confidence and that helps you to take that long-term

vision focus on the law of large numbers right everything that we've looked at in

trading an edge and then you can be the casino right

rather than the gambler you have the edge in your favor yeah and you can

trade with confidence so what i would do right um however you

want to do it whether you want to do it notion on a spreadsheet or literally

just on a piece of paper right be a bit old school is do this and then um

you can either do it at the end like i'm going to show you now or do it as you go

along and you know take a tick maybe you want to use this icon here right and as

each time you draw it on and you can even you know change that to green be

nice and fancy right maybe make it a little bit bigger whatever

um save it down as a template and you can go well in that case it didn't come

back that case it didn't this case it did so maybe you want to put like a

little tick there beside each swing low and then maybe you you want to put like

a uh

cross let's make it nice and red keep it pretty right and then you may want to

put that in all the places where it didn't right um

so that swing load and pull back uh to be fair that one did so i would just put

you know the tick beside the swing low just so you know exactly what it's

referring to so um

that one should go there right so that one doesn't pull back to the the the eq

into the discount so in terms of you know what we're trying to call stats on

then you can quickly go back and see you can count them all up right so you have

one column with all the ticks or one column with all the x's whatever and

then you will eventually come to a total percentage okay so i would just do it

very simply for the four-hour swing structure have a total number where

you've collected and you know what percentages in general and then you can

get a bit more advanced and you may want to have a separate column where you're

purely just looking at the first initial trend change right and then you'll

collect the stats on that so you have a really good idea about that okay um yeah

and so on and so forth and then if you want to be really

advanced right then you can start looking at mono brakes for structure and

things like that but i think that's a little bit overkill for now just

concentrate on your swing structure do it just on one time frame right i'd

recommend the four hour time frame and then again

as we go through the course we start to apply multi-timeframe analysis to this

we start to apply supply and demand and we start to apply liquidity concepts you

will then have such a great understanding

of you know when you can see but and anticipate ahead of time that price

isn't likely to pull back but you would have already done the hard work and you

already have the stats yeah i just can't recommend enough that you do this but

i'll stop ranting now i'll let you get on with it um yeah let me know how you

get on you know check your charts in the community if you want any feedback as

well and yeah i'll be really interested to see what stats you get because of

course there's not going to be you know everyone's going to have slightly

different stats here because everyone will view structure slightly differently

like i'm saying over here right some people may not view that as a swing

pullback some people may view that just as a minor break of structure um some

people may be even more aggressive so there will always be slight differences

but yeah keen to see what you guys come up with

yeah and see what stats you get so yeah put some nice music on and enjoy