What Is a Premium and Discount Zone?

In ICT/SMC analysis, premium and discount zones are identified using the midpoint of a selected dealing range.

Suppose a range extends from 100 to 200.

- Equilibrium: 150.

- Premium: Above 150.

- Discount: Below 150.

Some traders prefer looking for sells in premium and buys in discount, depending on their directional bias.

But remember:

A discount zone does not automatically mean price is cheap, and a premium zone does not guarantee a reversal.

Key takeaway: Premium and discount are contextual tools, not standalone trading signals.

Do you use the 50% equilibrium level in your analysis?