The false color look presumes the use of the Wide Dynamic Range View.
Using the False Color with other views in colour management will result in incorrect transform values.
This Wide Dynamic View transform can use approximately six and a half stops above middle grey and map them into the display referred values of 0 to 1.
Here's the histogram of an example scene. It shows 10 gray patches that are darker than middle gray (0.18) and 7 brighter ones. Each patch from left to right is twice the intensity than the previous one, except for the one at the very right that is just one half stop brighter. Note at the bottom left of the image the red arrow, it indicates the area between 0-1 (values used for display referred images).
(click on the image to enlarge)
Once the Wide Dynamic Range View transform is enabled, that wide range of values gets remapped to fit into the display referred range of 0 to 1. Middle gray gets mapped to a 0.60 and scene referred 16.29 becomes 1 (white)
(click on the image to enlarge)
Enabling the False Colour Basic look will allow us to visualize the Scene Referred values within the range defined by the Wide Dynamic Range View.
The mid gray is represented by grey. Brightes values will be represented as red and white, Darkest ones will be black and purple.
- The colour scheme is as follows:
Low Clipping = Black Scene Referred Linear value below 0.0001762728758
Ten Stops Down = Purple Scene Referred Linear value 0.0001762728758
Seven Stops Down = Blue Scene Referred Linear value 0.001404109349
Four Stops Down = Cyan Scene Referred Linear value 0.01124714399
Two Stops Down = Green Scene Referred Linear value 0.04456791864
Middle Grey = Gray Scene Referred Linear value 0.18009142
Two Stops Over = Green Scene Referred Linear value 0.7196344767
Four Stops Over = Yellow Scene Referred Linear value 2.883658483
Five and a half Stops Over = Red Scene Referred Linear value 8.150007644
High Clipping = White Scene Referred Linear value above 16.29174024
A possible workflow:
To do a grade on an image that uses a wide dynamic range, start by assessing your scene and think of what parts of the image should be the mid tones.
By moving the Power values on the CDL node try to make those areas fall close to gray or slightly into the green.
Using a power greater than 1 will make the midtones darker. Setting power values smaller than 1 will make the midtones brighter.
Then try to bring your Highlights within the range of the Wide Dynamic Range View
Use the slope for that. If you have areas in your scene that are white, you know that you have reached the clipping point (1) on the highlights, and you'll loose any detail on larger values. To bring those values down use smaller for the slope, and try to get your brightest highlights display as red with only a few white spots for the areas you want to preserve detail.
Quoting @troy_s When using False Colour, the goal is not to necessarily always bring all values into the display referred transform, but rather bring the reasonable values you expect into the view.
If you see black on the false color, you have reached the clipping point on the shadows. To preserve information on the shadows you want more purple and blue.
One thing to look for is that using small power values, might also affect your highlights and push them past the clipping point. If that is the case reduce the slope value to bring those values back.
NOTE: To expose the values and do precise numeric editing of any of the CDL controls click on the color box at the bottom of the big color circle to expose the RGB values used for the node's transform operations:
One more note The CDL node expects values in RGB. Even though there are some buttons for HSV and HEX, do not use them, the operations will not work as within the CDL specification.