DEALING RANGE STRATEGY - The Prop Trader

6/7/23, 12:17 AM DEALING RANGE STRATEGY | The Prop Trader
The Prop Trader <

https://theproptrader.co/>
ICT Concepts
Protected: DEALING
RANGE STRATEGY
The algorithm is in the Weekly chart. Look at the Weekly candle, is it likely
to expand higher or lower right away? Where did it trade from? Did it take
out liquidity or react from imbalance or FVG.
Identify inefficiencies on HTF Daily and Weekly Charts. Don’t go into the
LTF and look for entries until you are clear on what the Daily chart is
reaching for, then seek entry confirmation only.
If you know where Liquidity is at, you know where Fair Value is at, if you
know where Fair Value is at, you know where OBs are going to form.
As Al brooks said, the problem is not the 1m chart, the problem is time .
Our mind is not ready to accept fast changes. You should spend 30% of
your time on HTF, 60% MTF and 10% of your time on entry TF.
Look at the Previous Weeks Range and note the High, Low and all Daily
and Hourly Failure Swings. We assume the High and Low are
Liquidity/Stop Hunts.
Stop thinking about old Highs and Lows, think about Failure swings.
Highest High and Lowest Lows of DR is likely to be Stop Hunt 80-90%.
Failure Swings will house liquidity, focus on these.
If Order Flow is Bearish and Price is in Discount of the Previous Weekly
Range, wait for Retracement into Premium to go Short and a Run on
Liquidity.
If Order Flow is Bullish and Price is in Premium of Previous Weekly Range,
wait for Retracement into Discount to go Long and a Run on Liquidity.
https://theproptrader.co/dealing-range-strategy/ 1/10
If the previous day was a large range in the morning session, expect
consolidation. If the previous day was a small range, expect seek and
destroy.
Different Market Conditions
If Expanding, focus on Order Blocks, FVG not so important
If Retracing, focus on FVG/Imbalances
If Consolidating, focus on 50% Equilibrium
If Reversing, focus on Liquidity Pools
Dealing Range Strategy Rules Based Process
1. Accumulation / Trading Range
2. Opposing Liquidity Run
3. Market Structure Shift*
4. Initial Offset
5. Dealing Range Confirmed
6. PD Arrays at or around Equilibrium
7. Retracement – Fair Value for Buying/Selling
8. CSD / Continuation Setup – OB forms in FVG/BPR Liquidity
9. Order Block Model – Entry 1
10. Breakaway Gap / FVG Unfilled
11. Engineered Origin – Entry 2
12. Expansion
13. Final Offset – DOL
Example 1: Dealing Range Strategy
*Bearish Market Structure Shift MSS to the downside – Price must close
below the candle that took BSL on the way up
*Bullish Market Structure Shift MSS to the upside – Price must close
above the candle that took SSL on the way down
View MSS as a displacement into area where liquidity was initially taken
(+OB) and look for an entry from the FVG/BPR created by the
displacement instead of the traditional MSS that requires structure to be
broken.
For a MSS to the downside, price must close below the candle that took
BSL. For a MSS to the upside, price must close above the candle that took
SSL. Liquidity Pool will most likely be a Failure Swing, rather than a Trading
Range High or Low.
Example 2: Bearish BPR after a BSL Run
If price is going lower, down candles (+OB) should give way. If price fails to
close below down candle (+OB support), wait for MSS. Watch down
candles being formed, wait for close above.
If price is going higher, up candles (-OB) should give way. If price fails to
close above up candle (-OB resistance), wait for MSS. Watch up candles
being formed, wait for a close below.
If we close above a previous high, expect higher prices
If we close below a previous low, expect lower prices
The 3 most important rules when trading Order Blocks:
1. High Probability OBs must take liquidity and cause MSS
2. Retracement into +OB must be a down candle, retracement into -OB
must be an up candle
3. If there is an inefficiency in OB, do not use the open price of OB, use
50% of inefficiency
A Market Structure Shift happens inside in a range, where as a Break in
Market Structure happens when leaving an established range / change in
the state of delivery.
To anticipate a change in the state of delivery, first look at time, second
delivery.
The Dealing Range Strategy when Bullish requires only 2 important things:
SSL run and Discount Arrays. When Bearish there are only 2 important
things: BSL run and Premium Arrays. You determine which is more likely
by checking for BPRs.
If you don’t trust the FVG/BPR as an entry & want to avoid the possibility
of it trading into external liquidity, wait for the next candle to close on the
expansion from the FVG and use as a OB.
A Close Below a FVG BISI in Discount is Bearish A Close Above a FVG SIBI
in Premium is Bullish Anticipate CSD off an OB inside the FVG around 30-
45 Minutes past the Hour.
A candle that has previously traded into an OB and takes over
support/resistance for price to move away is referred to as a Propulsion
Block. The mean threshold of this candle is highly sensitive.
If the Algorithm does not respect a FVG and price trades thru it, the FVG
will act as support/resistance if price retests it.
Discount FVG (BISI) Redelivered to by a Down candle + Down candle High
taken, FVG has been respected.
Premium FVG (SIBI) Redelivered to by an Up candle + Up candle Low
taken, FVG has been respected.
When price returns to an efficient/balanced price range it should get
rejected immediately, price should not re-accumulate in a BPR, there is no
pending liquidity. A candle wick is a BPR, the speed of expansion increases
outside of a BPR.
IOFED (Institutional Orderflow Entry Drill) comes from FVGs that are
overlapped with BPRs from the previous curve of the MMXM. Price will
not reach up to equilibrium(CE) of the FVG, but will only rebalance the
inefficiency.
A FVG has 2 outcomes: either it is completely traded through or it is used
for accumulation.
If price leaves a Dealing Range of 81 pips, the PO3 Stop Run is likely to be
27 pips and the Expansion there after is likely to be 243.
Example of a 27 pip Stop Run on SSL, price is rejected and move higher.
The Accumulation is Time Distortion waiting for CPI Liquidity Run then
price Expands.
Example 3: Dealing Range Strategy
1. Dealing Range created in London Killzone

2. PDH BSL Run followed SSL Run
3. 0400 Bearish Order Block formed
4. 50% Retracement in NY AM Session
5. FVG/BISI DOL from previous NY PM Session
6. 0950-1010 Liquidity Run Redelivery
Example 4:
Submit yourself to time. Stop forcing setups. The True Trading Day is from
0400-1600 only, this should be considered the daily range and candle.
Regular trading hours are 0400 to 1600. Outside of these hours is purely
liquidity accumulation. True Daily Highs and Lows are formed within the
regular trading hours.
If the market gaps between 1600 Market Close and 0400 Market Open, a
gap fill trade is possible between 0815 and 0945.
0400 starts the OHLC PO3 for the day. Price will generally move away for
the 0400 price inefficiently forming a FVG or OB. This inefficiency will be
rebalanced later in the trading day.
Always use UTC-5.
If trading London, do not trade before 0400. Order Block usually formed
at 0400.
If trading NY, do not trade before 0800/0830 as US High Impact Data at
0830. Wait for the 0835 Candle to con rm OB and direction.
fi
The Liquidity Offset Macro runs 0945-1000 and the Re-balance Macro
runs at 12:45-13:45.
If a CSD happens at 0912, this is high probability.
Here are the most common macros that run on a daily basis:
1. Price Discovery Macro
2. Liquidity absorption Macro
3. Offset Macro
4. Rebalance Macro
5. Settlement Check macro
Pre-Market Pro les and Times < https://theproptrader.co/profiles/>

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Between significant price points, this is the order of delivery:
1. Opposing Liquidity Run
2. Market Structure Shift
3. Initial Offset
4. Retrace
5. Engineered Origin
6. Expand
7. Final Offset
Do not remove HTF FVGs/OBs from your charts even if traded. Pay more
attention to reclaimed and old FVGs/OBs, they might lead to new trade
opportunities.
Remember Tuesday 70% of the time creates the High or Low of the week
and Thursday tends to be a reversal day.
All you need is a PO3 with the time of day, every hour/4h/day/week. You
just need to identify which phase of the AMD process you are in to identify
the trade setup. The mean threshold of the London Kill zone and NY Kill
zone are usually the transition from Manipulation to Distribution.
Anticipate volatility in the 2 weeks around options expiration. Use this
calendar to plan your trades – MarketWatch Options Expiration Calendar
< https://www.marketwatch.com/tools/options-expiration-calendar>
Use the ForexFactory Economic Calendar <

https://www.forexfactory.com/calendar> to plan your trades for the
week.
The Prop Trader < https://theproptrader.co/>

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6/7/23, 12:17 AM DEALING RANGE STRATEGY | The Prop Trader

The Prop Trader <

Example 1: Dealing Range Strategy

Example 2: Bearish BPR after a BSL Run

Example 3: Dealing Range Strategy

1. Dealing Range created in London Killzone

Pre-Market Pro les and Times < https://theproptrader.co/profiles/>

Use the ForexFactory Economic Calendar <

The Prop Trader < https://theproptrader.co/>

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