Here is a super video I just saw. Its proof anyone can be a total sucess if they try hard enough.
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DislikedDear NowAndLater,
could you please define "discretion"?
To me discretion is nothing more than another set of rules. A set of basic rules has been defined for trading DIBS and saying that they have to be used with discretion means that the given set of rules is not complete and exhaustive.
So, if you can put in any logic form the "discretion" you are talking about I'd be happy to verify how it performs.
I've heard about "discretion" lot of times but frankly (and sadly) the need for discretion comes always from the need to raise an exception...Ignored
All these things needs to be checked on mtf's. These things will also keep you with the trend, which we know is powerfull on its own.
The next thing to check: are we trading the hot hand? And this can be different from day to day. I concentrate on GU and EU, so my question will be: is the USD strong or weak and which of GBP and EUR is stronger? Recently the Euro has been far superior to the Pound. For instance for the month of December GU is down around 4% while EU is up more than 9%. Now normally they would move like each other. What does this tell me? If the USD is up on a day then I would buy it against the GBP since it's the weaker currency, and if the USD is weak on the day then I would sell it against the EUR. This is a simple way of how I would determine the hot-hand of the day. The more complex way is to combine this (and look at the weekly % movement as well as the monthly) with candlestick analysis of the daily and weekly candles together with the study of s/r levels mentioned above. I will never trade GU and EU at the same time, overall they are too highly correlated and I only take the one that "looks" better.
The next thing I check is the AverageDailyRange. And this is my understanding of PC's rule to not trade to late in the day and that the best trades are early on in the London session. If I get a trade setup and the the daily movement is close to the ADR then I will most likely not take the trade. Reason is that it has a less probability to give me a runner. I might take it as a scalp if everything is set up, because there will usually be some sort of retracement after the ADR is met which will most likely take out my sl and not give me a runner. Usually the daily movement compared to the ADR in % is low around the time of the London open. For me the daily movement starts in the Asian session (this is not to be confused with the daily open!). So lets say we've already had a move that is 70-80%+ of the ADR, then I will most likely not take a trade. Not trading is also a way of protecting my capital, there will always be tomorrow. Lower % and I will take the trade.
The next thing is money managment. 10 people can take the same trades all year long, with the same entry and stoploss levels and I can guarantee you that they will all have a different result at the end of the year. Two reasons for this: cutting your losses short and letting your profits run. I will from time to time close a trade before it hits my sl if I don't like the action and in that way save me some pips. And I have found a way of letting my winners run that suits my psychology. This is extremely important as you all know. But this is also something so indivicual and this is also why the 10 people mentioned above will have so different results. This is why I wrote "This method is a price action method. Once you understand what that means you will turn profits from this method." You have to study how price reacts to s/r levels, understand chart patterns and basic TA, and have a sound MM system in place. In the end, it is YOU that have to have this understanding, and we all have different understanding of the markets which is why there are so many different systems.
Yes discretion is another set of rules to me too. And it's these rules that are vaguley presented in this post. More precise rules of for example what defines a s/r break or hold and candlestick interpretation is not presented here. I just can't imagine how a "simple" EA would ever replace the eye in a sufficient manner. Remember that I don't look for too many trades, I look for the ones that after my understanding has a somewhat higher probability. This all may seem to be overdoing it, but it really doesn't take me a whole lot of time to go through this on a daily basis. Do you think you could make an EA with this kind of discretion?
One last thing: the IB is not a trigger to buy/sell. It just gives us a place which has a low risk and high reward potential. Just this basic principle alone has led me to look for other situations which present me with a good R:R ratio, not just for IB's, and has given me other trade opportunities. All the things that PC has written is just terrific information. But we are all affected by this in our own ways and must make our own understanding of the information given. I would certainly recommend to read PC's posts more than once, do a little bit of chart studying, then go back and read again before looking at the charts again.
This has been a lengthy post. I will just round off by wishing everyone a merry xmas and a happy new year.
DislikedHere is a super video I just saw. Its proof anyone can be a total sucess if they try hard enough.
http://www.youtube.com/watch?v=1k08yxu57NAIgnored
DislikedOk here is the number one thing that I look at when deciding if I'm to take a trade or not...Ignored
DislikedCandlestick patterns analysis can be easily implemented in EA, I used that already a bunch of times. S/R levels requires a bit more work as one must chose them carefully... but if it's worth it can be done.
I think one should also check what's behind the IB formation... I trust pretty much triangles and pennants for breakout but if the IB is result of a range formation then I think it's not worth to open a trade... I should check this on the chart on the number of good openings I get.Ignored
DislikedI'm thinking I should perform an analysis of which common elements I can find on those IB which generate good trades, then define a set of rules to filter the DIBS. I'll follow your hint.Ignored
DislikedHere is a super video I just saw. Its proof anyone can be a total sucess if they try hard enough.
http://www.youtube.com/watch?v=1k08yxu57NAIgnored
DislikedCiao, Zypkin? What a "hot" Italian guy is doing in freezing Estonia?Ignored
DislikedBy the time you perfected an EA which can cover just 50% of those variables well, you'll be able to trade "manually" better than your EA.Ignored
DislikedHowever, entries are only half (if not 1/3) of the problem. If two traders took the same trades, the one who handles exits better will make more money than the other.Ignored
DislikedYes I always check lower timeframes as well. But to me pennants and ranges are the same as it's always an s/r level that needs to be broken. The difference is just what this s/r looks like, and what characterizes a break of it.Ignored
DislikedThe reason is that better entries means a higher percentage of winning trades. Now, as profit is by definition [ %win*AVGwin-%loss*AVGloss ], by improving my % of wins I not only increase my gains (like your hypotetic fellow) but I'm also reducing my losses.
So hell, I want to make better entriesIgnored
"Am I deluding myself by following his assertion that successful trading is predominantly based on mindset--and that this is the key--this is all that has been missing from my previous trading ventures? I have spent years and thousands of $'s trying to educate myself as to trading systems, books, and methods. I thought that all I really needed to do was find a trading method that suited me - (my psychological makeup), something I could follow with a degree of self-confidence...Is there any hope that this might become a possibility?"
DislikedHere's a simple indicator I put together for this system.
Has a few options that should be self explanatory.
Enjoy and good luck!
Lux
PS: If you only want triggers for the current day set 'bBackTest' to 'false'.
UPDATED
V1.1 - Fixed problems with last trigger not being drawn correctly.
NB: Could still have minor bugs so let me know if you find any and I'll try to fix it if I have time.Ignored
DislikedI by no means meant to imply that skill development was not necessary to success. What I meant was that no matter how much time was spent on skill development, no matter how proficient one became at technical analysis, money management, risk management, ect, no matter how many people try to help someone with tips, tricks, pointers, systems, ect, that alone will not guarantee any kind of real success.
It's something I believe is absolutely vital to success at anything one wants to accomplish, and I have read many bios of successful people who elude...Ignored