Premium & Discount Trading Strategy That Catches 75% of Reversals

In this video, I break down a premium and discount trading strategy using optimal trade entry (OTE) to show how price consistently reacts at key Fibonacci retracement levels in trending markets

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I walk through how to identify premium and discount zones using external swing highs and swing lows, why the 50% level defines fair value, and how the 62% to 79% retracement zone refines large discount and premium areas into a precise entry window.

You’ll see how I use a modified Fibonacci retracement tool on TradingView to map out discounted price in uptrends and premium price in downtrends, and why this approach helps avoid chasing breakouts and poor entries.

I also explain how market structure, including change of character and break of structure, determines direction first, while premium and discount define where to trade. Once price reaches OTE, I show exactly what I look for on lower timeframes to confirm entries, manage risk, and place a logical stop loss.

Most traders miss this part, but I also cover what it means when price disrespects OTE. In many cases, acceptance above or below the OTE zone can act as an early warning sign of a reversal, sometimes hours or even a full day before a change of character appears on the chart.

Throughout the video, I break down real EURUSD examples step by step so you can see how this premium discount framework plays out in live market conditions, both when it works and when it fails.

If you want a clearer way to define fair value, refine your entry point, and trade in alignment with the market trend instead of reacting emotionally, this video will give you a solid framework to build on.

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CHAPTERS

0:00 Intro
0:23 Premium vs. Discount
1:30 Optimal Trade Entry (OTE)
3:42 EURUSD 1st Example
8:56 OTE Entry Model
11:14 EURUSD 2nd Example
19:22 OTE Win Rate
21:30 OTE as an Early CHoCH Warning
26:00 Unmitigated OTEs

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Disclaimer: This video is for educational purposes only and is not financial advice. Trading forex, crypto, and other markets involves risk and may not be suitable for all investors. Always do your own research and never risk money you can’t afford to lose. I am not responsible for any losses you may incur from acting on the information in this video.