Drop-Base-Rally (DBR): price drops sharply, consolidates briefly (base), then explodes higher. The base marks a fresh demand zone where institutional buying absorbed all selling. Fresh DBR zones are high-probability bounce levels.
Indicators Used
Swing High/LowVolume
Rules
📈 Long at DBR Zone
- Identify Drop-Base-Rally: sharp decline → 1-6 candle consolidation → sharp advance
- Mark zone = high and low of the 'base' candles
- Wait for price to return to this zone later
- Zone must be FRESH (first touch since formation)
- Enter long on bullish reversal candle at zone
- Stop: below zone low
- Target: 3:1 R:R minimum, or next major resistance
🚫 Skip Setup
- Zone has already been tested and broken
- Base has more than 6 candles. Too much 'memory,' probably weak
- The rally leg is less than 2× the base size (weak demand signal)
1-6 candles
Base Size
3:1
Min R:R
💡 Pro Tip
The strongest DBR zones have explosive rally legs. The bigger the advance from the base, the stronger the demand imprint. Look for zones where the rally exceeds 3× the base size; those are institutional buying footprints, not retail.