No Free Lunch but all the Free Coffee you can drink

Hi Peter:

Quick question regarding the last chart you posted from May 2nd. On the second add-on trade that turned out to be a winner, there was a bearish bar sandwiched between the inside bar and outside breakout bar. This bearish bar actually dipped below the lows of the inside bar, wouldn't that have been a stop-out? It even went below the lows of the outside bar on the left, which, from what I understand, would invalidate the whole DIBS setup. Or am I missing something here? Perhaps I have been too strict with the setups.

You are absolutely right about there being a downside breakout from the inside bar before the market turned around and took out the high of the same inside bar.

If you were trading purely mechanically, taking all breakouts that fit the DIBS concept--, you would have definitely taken that short (and been stopped out, not a major catastrophy) prior to the long trade created by the upside breakout of the inside bar. If you had absolutely no other idea about the market than DIBS indications you could and probably should.

I was not interested in taking any short positions in the market shown, and was just looking for buys.

I did take the first illustrated DIBS trade to the long side, and got stopped out. That first losing trade also had a breakout to the downside before the buy took place, the low of which I used for my risk point-- which is where I got stopped out.

Not deterred, when the second inside bar formed, I was willing to trade again-- but as stated above, only the buy side. Since the trades were still early in the day and still hovering near (but above) the day's open, the potential for a high reward trade for the day still beckoned.

Some choose to trade DIBS only as a daily trade concept, taking all trades it offers, long or short according to the concept and they exit big daily winners at the end of the day.

Others extend their potential by virtually turning DIBS into a swing trading method---by holding on to their winners, only getting out on a following day if there is a DIBS reversal trade. You would be surprised how many times you can get into a DIBS trade at the beginning of one day and not get any reversal DIBS trades for many days after. It is usually due to major developments hitting the market. DIBS traders are natural profit recipients of one-way market actions. That is when your tireless actions of taking your low risk trades over and over get paid off, when the "world" now wants the position you put on with a tiny little risk days before. Got to love the perversity of the market!

-PeterCrowns-

Thanks for the explanation, Peter. Some would also add that the fact that I choose to trade at 3 am in the morning (in addition to how I look at this ungodly hour) is also "perverse", but I digress...

One last question for ya, where did you place your SL on that second winning trade? Since that bearish inside bar had the lowest low of the day, I would have been stopped out for sure.

-Mgh-

Thanks for the perfect question for the following response--

Short answer: no, but I will elaborate a little on why not.

I had an interesting PM exchange with an FF member recently about what we "KNOW".

It is one thing to "know" something and another to act on it. Only action gets rewarded, even if your action is handing off what you "know" to someone else who will act.

What everyone "knows" is different, along with the level of certainty each person requires for themselves to "know" something is true and is expected to be true in the future.

I have learned the hard way that my requirements for "knowing" something are much higher than most traders. I encourage you to adopt the same standards.

When people are at the beginning stages of learning to trade the markets, (I remember in horror my own ridiculous thoughts when I was new) they see something happen 10 times and think they now "know" something. And then wonder why they just lost $50K when they acted on it. In the bigger reality they don't have enough scope. If they survive, they'll maybe get it, but it always has a cost.

This is also why age and experience pay off so well in trading.

If you can get to the point where you can survive 3 or 4 years of trading, barely breaking even or losing very little while trading a few times a week; you have much additional market knowledge built up. Then, when you find a decent, trading method and couple that with the ability "tradingwise", to chew gum and walk without falling down-- you can start making real money.

It is very normal for some of the best traders to go through years of barely profitable trading and then whosh!-- they really take off because they finally "get it". I've have friends that didn't make any real money for 10 years, finally get themselves straight and make a couple of million every year thereafter. They finally accumulated a combination of assets that allowed them to prosper.

I got my combination put together years ago. It didn't just drop in my lap. I'll give you my secret in a minute.

I am definitely not perfect, but I do not trade on hope. Just the facts of price and statistics with no spin on them. And facts I know from other contacts I have acquired over a 20 year span. I do not want to trade unless the trade has so little overall risk that it would be stupid to not take the trade.

I still believe that most people who "know" they are meant to be traders should be working in real estate. They would do so much better with less risk, time and 1/10th the learning curve.

I also believe I "know" exactly how people could learn to trade profitably, using the least amount of time and risk. But I have no motivation to do it.

In many ways I regret mentioning anything on this forum. What you've seen in this thread is about all I'm going to say or offer. I may post from time to time, but I really don't see much benefit. Atlas Shrugged explains my overall view in this regard.

(The secret I said I'd mention)
I "KNOW" that people who absolutely have to find out how to trade correctly and profitably are willing to do ANYTHING to get that information, and then get it! I was..., and got that information! You think it was free? (You who thought I should have put "almost" in front of "anything" in the preceding sentence-- you might want to find a kinder profession! Serious trading isn't kind to anyone involved--)

If you are willing to pull out all the stops, you can succeed! That will be an edge you will have over the many thousands of others here who don't want to pay what must be paid.

I am sad to say my experience has been that most people in forum environments just want something for free or for someone to do all the work for them (for free) and aren't willing to put forth the real work necessary to get the benefits. So this posting adventure reaffirmed to me that it is likely a waste of time for me to continue posting.

A Word to the Wise is Sufficient
Intelligent people can take hints; they don’t need to have everything explained to them at great length. I have had contacts with a number of fine people from this forum who fit that category and have no doubt they will find their way to success if they keep at it.

-Mgh- Thanks again for the interest and fine comments, and indeed all of the other great comments and assistance great people have offered on this forum.

I'm not unhappy with any responses or individuals here. I just need to get on with trading and only see any further contributions as a form of effort without compensation. I have relatives that resemble that situation already.

Thanks again for having me for a short time.

-PeterCrowns-

Peter,

Your response was nothing short of a "bombshell" to me, quite honestly.

Again your words of wisdom, that come from years of experience and dedication, are most appreciated,

I apologize if you were thinking that I wanted something extremely valueable for nothing more than posting a question.

As you can see from my number of posts on this forum, my first post, and only other posts were to you, after having serendipitously found this forum. I don't post on any other forums.

I search other forums, but this is the only one I've joined, after reading your posts. I wanted to learn more from you, and of course as much as possible, that's only natural.
I would be happy to exchange mutual trading information with you, however, I simply am not near your level, so...compassion?
I read Sun Tzu, and just lived in China for 2 1/2 years, compassion is a gift to those less fortunate. Victory is .....

Peter, regardless of all that, please stay around, help us out a little, even someone like me who's been trading for more that 15 years, yet never really successful, never had a margin call, but has never given up on someday "Getting it together'.

Your post were like a light in the darkness.

Cheers,

MGH

I shorted the GBP a few minutes before George Soros did in Sept 1992 but my order wasn't filled.
I didn't have any 'inside info' it was a 'just' a technical trade that some broker took from me.

The only inside info I get nowdays, is grilled cheese sandwich day at my 10 year old son's elemetary school.

What a great thread. Thanks Peter.

Looking to short on Aud/usd.

Stopped out (demo).

My word is Thank-You to Bemac for starting this thread and to Peter Crowns for sharing his knowledge with us http://www.forexfactory.com/images/icons/icon7.gif

Its now three years - and more than 9000 screen hours ago since I first started looking into trading forex. My first ideas were based on a breakout of the overnight - Europeanwise - trading range. After my first reading of this thread it seems that I was heading in the right direction and that after several "off piste" excursions I have now come full circle!

Now to read the thread again more slowly and work out how I can best use this gold mine of information - I've already noticed so many little gems that I'm starting a new workbook.

In case others find this useful, I've attached the Trading Session V Lines indicator for MT4 users - it places up to 4 hourly time lines per day which can be helpful when back-testing.

Jarroo: My thoughts are that I would have been looking for a long on this trade (I don't trade AUD/USD, and am at work so cannot look at a chart, so stated times and prices are an estimate).
My reasoning:
The green Doji is the 3AM CentralUS bar.(i base this on your posting time) The long red down candle is the 2300central.
The close at 2300/open Midnight price bisects thru the midnight inside bar.
The trend is up from the opening of the 5-may / close of 4-May price which looks to have been approximetly .9370 area.

I also am just beginnig to study this method so am posting in the interest of clarifying my understanding not to 2nd guess or criticise.

Hi Peter,

I wanted to thank you for taking the time to impart some of your wisdom in this thread. It is experienced traders such as yourself who leave a trail of golden nuggets dotted around the FF for others to find that make it very worthwhile to continue searching for the pieces to the puzzle.

Thanks also to Bemac for opening the door with this thread.

Good trading to all .

Forexhen

Great reasoning Mr. Green and I agree. I'm just looking at the method myself and looking for understanding too.

Aud/Usd on Monday looked good.

Hi guys

I have been demo'ing this method for a few days. So far I have no succesful trades. I have not taken every entry. I will keep trying. I'd be interested in hearing/reading if other traders are trying it also.

TP

I had about 5 trades and I'm on the green side. Especially because of one huge gain on a trade on AUDUSD since early yesterday.

But I need to add that I use it in accordance with my own strategies and so I might skip setups on purpose.

I would also like to express my gratitude to PeterCrowns for the time and wisdom he gave to help us at FF. Also to Bemac not only for starting the thread but for having the maturity to let it develop outside of his control in ways he could never have imagined.

Unfortunately I only starting to read this thread the day Peter called it quits. So I would also thanks those who asked questions in a respectful manner, as the answers helped my understanding.

Here is the most valuable teaching that I found until now on FF.
THANK'S PETER!

I too would like to thank you Peter for not only sharing but doing it so eloquently and with style.

Perhaps the thread will wither but hopefully won't be removed in order that some future Members may find it usefull.

Perhaps another member will be encouraged to contribute something different that might be received as well as your pearls of wisdom were.

Whatever happens, I am pleased that little acorn grew strong in such a short time.

As far as me standing out of the way, why not? I was happy to do so. I may not have posted much but kept abreast of every post.

Hope to see you around at least occasionaly.

Bemac

Interesting how the "masters" seem to do this. fti's approach (to trading and explaining) could not have been more different. Yet they both do it "so eloquently and with style". They both leave you feel all the wiser for having studied their posts, believing that you can do it and in "the zone" to want to learn more.

Well, I am quite sad to see Peter go. I had so many questions about the market (btw, nothing to do with trading methods) that Peter probably would have been able to answer.

I would like to thank you for the insights, wisdom and clarifications that you have posted so far. I have come away with better understandings after reading your posts. I hope someday you will be bored enough to come back here again and impart some more insight to us.

I wish you all the best in your future and may we meet someday as fellow successful traders.

Regards,
K.

Thank you Peter. I had a good time reading your posts.... what I really enjoyed was hearing a little about your beliefs/attitudes and experiences.

Thanks for posting.
Great quote.

Best wishes
Stewart