The DIBS Method... No Free Lunch continues

My30 is confusing matters. Could we keep to the IB met

Firstly, I want to thank jarro for maintaining this medium to exchange ideas on the markets. The job your doing is top notch.


However, after reading this thread from beginning to end, I'm kind of disappointed. No real progress seems to have been made on a collective basis. I'm sure on a individual basis some positive things have happened to real students of this method. This thread started from such fertile soil in the beginning with Peter Crowns excellent thought provoking posts. That spirit got swallowed from every day life. It seems even the valuable contributors of this thread lost that spirit as well. It would be great if Jarro could open another thread and only serious discussion would take place in the same manner that Peter posted. Maybe that spirit can be revived. Its quite possible if the thread is managed well and non productive posts are deleted Peter may just post again.

Honestly, I think the main reason Peter posted in the first place was the name of the thread. No Free Lunch. The concept suited him well and all he got was beggars and thieves pestering him for his generous help. There was some serious people as well but their voice got silenced by the mass ignorance.

It seems people have totally missed what Peter was trying teach. He was trying to teach you to think for your self so you can make a genuinely informed decision. Its total joke how many questions came in about the opening time. Peter stated clearly he uses 00:00 Central U.S. time. No one could take the time to think for themselves why he used that time. They wanted to be spoon fed what time to use. Then the big disagreement about day light savings or sticking to pure GMT. He clearly would use common sense and use London time or Chicago time as it relates to gmt. Rather than GMT. It's simple why is the market moving at that particular time? Because traders are arriving at their desks ready to put money to work. Its not magic traders move the market and what time do traders use to show up at work. Frankfurt time, London time, New York time, and Chicago time.

My second regret was that inadequate discussion was conducted to determine how to correctly trade this method. How Peter traded it. Thats why I have shown up to bring about that discussion.



Only a chimp would buy all inside bars in a up market and sell all inside bars in a down market. Its only common sense. If the market was so easy there would be a lot more billionaires.



I'm not saying here that the method needs to be over complicated or a grail search or anything like that. What I'm saying is that you typically need a catalyst to move the market. The Inside bar break was just a risk management tool to take advantage of that catalyst. In other words you need to work for a living not just blindly entering every inside bar break and you need to tap your experience data bank as well. That work I'm speaking about is detailed record keeping. To know which circumstances have a edge and which do not. Peter made this very clear in his posts. About having a greater edge even though the pattern looks the same. He derives that edge from record keeping and then implementing his findings.

My theory on how Peter trades this risk management tool known as the inside bar breakout comes from his personality. I have three family members that traded on the Merc or the CBOT. One still trades at the CBOT in the beans pit. The other two are in the Merc building (old cbot building) trading up stairs. Any way I know the typical mindset of a Chicago trader and how they trade. This is a broad generalization so don't take it to serious, but maybe it will spark some ideas.



Chicago traders trade off order flow much much more than technical analysis. Chicago traders love to be part of the move that triggers a stop run. These two things have deep implications for how to trade this method.



Firstly, I"m near certain Peter trades off order flow. This is clear because his 9-10 late in the day rule. By this time order flow in basically non existent also his lack of concern for the Asia session. Asia has little volume irrespective of the price swings. FX is not the easiest market to gauge order flow. However, he traded in the pit eight years so I'm sure order flow became second nature to him and he can tell from a chart how order flow is flowing. Its not as simple as price is up so order flow is buying. There are nuances.



But the main idea is that he is anticipating order flow and using the inside bar as a risk management device. Just because you have an inside bar break its huge jump of faith to say that such an occurrence will create a surge in order flow. So your task is to find instances where order flow will pick up and then look for inside bars at that location that line up with the up day down day filter. Now the question what creates order flow and how do I know?



Order flow is created in two ways genuine buying (selling) or forced buying (selling). There is one thing all should know about trading its not a big party with all the big traders being in the know and making a lot of money. Someone big is making a victim of another big trader (forced buying or selling). If the market is void of any big fundamental events or fundamental reasons order flow is typically of the form of a few institutions trying to make victims of as many traders as they can. (Forced buying- selling) Therefore, my theory on how to trade this method is to find situations that will generate order flow. Either forced or genuine. For the most part try to anticipate where the victim will lose confidence in his position that happens to offer a inside bar at or around that location.

I have gone to far so I will bring this to an end. I just hope some people on this thread want to take this method to the next level and discuss it in a serious manner. If believe thats the case and maybe if its done right Peter may just show up again if the degenerates can be kept away.

Thank you Jarroo for starting this thread and thanks to Peter Crown for sharing his system. I also want to thank Aad and everyone who contributed there advice and programing skills. I have one question, does the breakout bar have to be next bar after the IB bar or can it be 2 or 3 bars after the IB bar?
Once again thanks everyone,
And have a happy and healthy holiday,

Guys, it's been grade to hang around with you on this thread.

Jarroo, once again THANKS A LOT for setting up this thread and keeping it going!

I wish you all Merry Christmas and a very prosperous New Year! Happy trading in 2009!

Hi guys,

what do you think, EURUSD will go down till 1.3850 ( - 61.8%)?

And what part of DIBS Method did YOU not quite get a handle on..........
Your question belongs in the EUR/USD thread. Or maybe the James 16 price action thread..

Thanks for the great post.

Guerreat post:
With Twee's new structure, it may even be possible.

Guerrillawar....
Great post and some good ideas.

That was a good read.

This IB thing was not working out that well for me until I stopped treating IB's like an entry trigger, and started treating it more like an alert of a possible low(er) risk opportunity to jump on the trend. I have started looking for what I call 'areas of interest', a term I borrowed from someone else on another forum. When an IB forms at what I consider a potential area of interest, I still do not jump into a trade. I go down to the 1m and 5m chart to get an idea of price momentum and patterns that might give me a better, lower risk entry. Only when chart patterns on the lower TF (like a triangle) appear and are broken and then price momentum in the direction of the IB 'method' agrees, only then do I take action on the hourly IB that has formed.

I am not articulating that well I think, but when I read your post I was like, yeah that's what I have been thinking about. I don't consider the IB a system, more like something that occurs and demands a closer look to see if other conditions apply that create a higher probability, lower risk entry opportunity.

Of course finding areas of interest is probably another art form in itself, and something I am sure I could use a lot of work on.

I'm hoping if this occurs I could at the very least be able to read it, even if I don't have the credentials to post...

Hi JJ. I agree 100%. ALL Members must have the ability to access ALL Posts that are approved by FF.
I think the idea is, not to exclude members from advancing, but moreso to attempt to have a cleaner thread with less clutter of "What TF does this work best on?".

btw. worked in Osaka & Kyoto. Life altering to grasp the Japanese view of life. loved it.

Life altering is a good way to describe it. Do I love it? Not yet, more towards the other end of the spectrum, but I have a feeling that has to do with the move out of a fast paced semi high profile software job to being reduced to a stay at home dad in rural Japan (which is the opportunity of a lifetime, just much different than anything I am used to). I do find Japan and the culture fascinating though.

The silver lining in it all has been the ability to devote unhealthy amounts of time to forex over the last 6 months. I can see why it takes some so long to become successful at trading, only being able to devote a few hours per week would take forever to learn this business.

Sorry, back on topic

Therefore, my theory on how to trade this method is to find situations that will generate order flow. Either forced or genuine. For the most part try to anticipate where the victim will lose confidence in his position that happens to offer a inside bar at or around that location.

Excellent post Guerilla. As has been pointed out numerous times on the James16 thread, location is more important than the particular price action.
Cheers,
Dave

Hi All

just wondering if anyone has the same problem as me or if anyone knows a fix to this.

when i try to attach DIBS TriggerLines v2a (AAD Mods).ex4 or even the earlier version DIBS TriggerLines v2 (AAD Mo..ex4 to a chart metatrader pops an error a problem caused the program to stop working and shuts down..

help needed

thanx in advance

A Merry christmas and a great new year to all

I had an idea (not really new) that would benefit the real students of this method. I have quite a few thoughts on how to trade this method but I'm sure they can be improved by others input. Plus I'm not the best tester, record keeper, or I.T. person. Some one with those skills is what's needed to take this method to the next level. I'm pretty sure some of you have good ideas that maybe I can refine a bit as well. Honestly, I don't want to post them here for the general public I don't think they deserve them. There is way to many degenerates.

My idea is that the real contributors of this thread would communicate through the private message option. Not all that often just maybe once a week to address major issues with this method. Jarro what do you think?
And if you are for it Jarro who do you recommend as being in this sub-group. I have a list but maybe I'm missing a few useful people.

My list of useful posters on this thread:
Jarroo
Billflet
Edwink
Bemac
OzzieDave
Noodle
Kermut
Dabuschi
Housetrader
Daytrader
John Doe

I'm feeling happy. I just had a great trade and it happened so fast. Got to my desk at 0700 London time. By 0745 I was mostly out of a super trade. I thought I shall give some examples how I trade this method.

Firstly, I have system A and system B and I don't work in 1/2's I work in 1/3's. System A exits 2/3's of position when I reach Risk x 3. System B exits 2/3 when I reach Risk x 1. When I feel confident about my position or it has a greater edge according to my records I use system A. When the position is taken and its not the best position based on my records I deploy system B.

My trade was a long Eur/Usd at 1.4012. I was managing risk based on the inside bar of the 0100 New York time bar.

Here is a list of things that I thought favored this play and would create order flow in the direction of the inside bar break.

1. H1 Inside bar break (risk management device)
2. H3 Inside bar also existed however that break was 24 pips further than H1
3.M10 chart indicated a S.O.S. (Wyckoff method minus the volume) (if interested look on a candle to get the total picture)
4.Busted minor Fib confluence ( I like to fade fibs not use fibs since this is not a countertrend strategy)
5.Busted H1 bollinger
6. Sound base and high of Asia that was also a Fib reaction point (looking to fade)

What all of this means to me is that a countertrend trader is going to be the victim of the trend following trader in this circumstance. There is enough reasons to make the case to be a countertrend trader that means victims. My initial reference point to indicate if my plan is going as it was thought out was the high of Asia. I wanted a fast break of those highs which indicate to me stops are being hit. This took place so I was quite confident in my position. This is not a checklist that needs take place for every trade this is just a plan I made based on current conditions. Rather than forcing my static plan on current conditons.

Eur/Jpy

Just about everything was decent if you were long the euro. This is one way to determine genuine buying or relative strength. The euro breaking across the board.

There are others : NowAndLater, Dale, razeldazl . . . Oh let's not forget Peter Crowns . . . etc. There are many more.

I do appreciate your efforts to keep this thread within its focus of what we know of the DIBS method. Your previous post was well written and very informative. And I thank you.

I do not think there are many "degenerates" (if any) on this thread. I think my30mar was more of a communication problem. I sure you meant people that drift off the basics of the DIBS method and tend to add other "stuff".


I intend to be more involve in the future which will help keep this method on the right path.

Thanks again

Jim