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The DIBS Method... No Free Lunch continues

  • #7,581
  • Apr 13, 2009 9:16am Apr 13, 2009 9:16am
Long Eur 1.3297 SL 1.3264.

Im going to trade this one to around the 1.3400 area if it gets there. There is alot of downward pressure from 4 hourly, daily and weekly trendlines (trend is short term down).

If we get there i will exit most lots and look for signs of continue or reverse
  • #7,582
  • Apr 13, 2009 11:36am Apr 13, 2009 11:36am
Great setup after long weekend

Purple was last week close.

Blue lines are entries.
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  • #7,583
  • Apr 13, 2009 12:26pm Apr 13, 2009 12:26pm
hi fxmike~

so entry was bar high + 1 pip + spread.

did u use oanda's 2.1 spread? so 1.32171+0.0001+0.00021=1.32202?
  • #7,584
  • Apr 13, 2009 1:01pm Apr 13, 2009 1:01pm
Quoting jarroo
My results have been very good. Although I have not traded the DIBS method on a consistent bases recently.

On your paper trades, I would check which trades were with the over all trend, meaning the Weekly, Daily and even the 4 hour trend. Taking DIBS trades with this trend (and not taking countertrend DIBS trades) should show a more postive result.

Also, how many of those DIBS trades were with the trend did you let run? Meaning you caught the Daily trend on the hourly DIBS trade and you let it run until it was stopped out. Yes, I understand...
This is from Jaroo (post: http://www.forexfactory.com/showpost...postcount=6341 ) Please take a look at his charts on that post and read his post to see what I am getting at here.

Razor, this is what I was referring to when I posted. I don't mean to say that that there shouldn't be any losses, or that some way needs to be created to guard against them. As you mention, some will work and some won't.

That's not the issue to me. The way I see it, the way to be the most profitable with this system is to accept many small losses, many more break-even or slightly profitable trades, and do everything possible to ride the very few truly huge winners out as long as possible. Whether or not someone ends the year with outstanding gains, mediocre results, or even in the red could easily depend on only one or two of these big wins. And my belief is that the only way someone can get positioned to get these critical wins is to take every reasonable trade available as defined by the system and keep taking the small losses over and over again, always as if the very next trade will be the one that pays for it all many times over.

That point was what I intended to make when I posted earlier. In my feeble attempt at being humorous I seem to have failed to make myself clearly understood.

I believe that this is the most profitable way to trade this method, and that it is very difficult for most people to withstand the constant grind with only the rare big win to make it all worthwhile. That is why I think there will only be a few people who will be able to do it well over the long run. With that said, I still think that is the most profitable way to trade. And I think the psychological difficulties can be overcome if you have the confidence and faith in the system to know what you are up against and are prepared for it.

This is the understanding that I had from PC from the beginning when he started introducing the DIBS system. I don't recall if he actually ever said it in that particular way, but it has been explained by several other traders in the past similarly.

Anyway, in my humble opinion, this is the way I see the system. But still, I could be wrong.

Thanks.
  • #7,585
  • Apr 13, 2009 1:09pm Apr 13, 2009 1:09pm
spicymonkey entry at 1.3220
  • #7,586
  • Apr 13, 2009 1:14pm Apr 13, 2009 1:14pm
Quoting fxmike101
spicymonkey entry at 1.3220
thanks mate~!
  • #7,587
  • Apr 13, 2009 4:03pm Apr 13, 2009 4:03pm
There are no reasons for massive drawdowns with this method.There are so many markets to trade that within a few days there will always be a wiining trade. Ive not been doing this long but analysed the last 6 weeks in detail over the easter weekend and only the eur/chf and gbp/usd made a small loss. The others all made good profits. If id taken all the trades according to peter crowns rules with my own exit strategy( max 100, pips profit for purpose of exercise) I would have been up over 4000 pips for the six weeks. Sadly Im only part time at the mo, but still made over 300 pips for the last 3 weeks. Early days but a good start.
  • #7,588
  • Apr 13, 2009 7:18pm Apr 13, 2009 7:18pm
Quoting PistolDave
This is from Jaroo (post: http://www.forexfactory.com/showpost...postcount=6341 ) Please take a look at his charts on that post and read his post to see what I am getting at here.

Razor, this is what I was referring to when I posted. I don't mean to say that that there shouldn't be any losses, or that some way needs to be created to guard against them. As you mention, some will work and some won't.

That's not the issue to me. The...
Thank you for your response. I understand that according to the rules, as a new trader we should be taking all the trades and also by the rules, letting them run. This is why I have said it is discretionary as to what a trader does and his/her interpretation of the guidelines. Me myself will place a higher degree of capital on those IB which I feel have a greater chance of working. When the situation is relevant and a reversal IB to get you back into the trend with a pin IB or something of that nature, i will take more into it than say the same IB in a range. Others will not.

It is also my attempt to gradually build my account as I dont trade full time so having a method that I can check only every so often if my more versatile than other methods that require screen time. I also trade a weekly bar system that I enter on Monday and exit on Friday if I havent been stopped out. This is another situation where there will be a number of times where I will go weeks without a win, however once in a winner I can easily take profits along the way. For instance (i only trade this method on the GBP/JPY) this week I am up 180 pips on this. I have taken some at 150 and have the rest running. If I get stopped out then thats fine. A couple of weeks back I got just over 400 pips out of it. The total move if I stuck with it would have given me closer to 800 pips, but it is something I am trialling. It is another good method for me because I do my homework before the market opens, once it opens i place my order/s (maximum of 2 per week) and then just look at it when i look for dibs. If its up I take profit at levels. If im out then its a bad week with a small loss.

You point of view is very valid, and it will give traders the questions that they need to ask themselves about how relevant this method will be for them. As I have said, and will say countless times, traders need to be 100% comfortable with the way they are trading. If they arnt they will deter from the goal and outlines and start looking for answers to a method that is working, just having a down period (like they all do)

Cheers cobber

Take care
  • #7,589
  • Apr 13, 2009 7:20pm Apr 13, 2009 7:20pm
Quoting julian
There are no reasons for massive drawdowns with this method.There are so many markets to trade that within a few days there will always be a wiining trade. Ive not been doing this long but analysed the last 6 weeks in detail over the easter weekend and only the eur/chf and gbp/usd made a small loss. The others all made good profits. If id taken all the trades according to peter crowns rules with my own exit strategy( max 100, pips profit for purpose of exercise) I would have been up over 4000 pips for the six weeks. Sadly Im only part time at the...
green pips are green pips and all you can do is trade your method.

Well done
  • #7,590
  • Apr 14, 2009 4:17am Apr 14, 2009 4:17am
morning all, hope everyones weekend was good!

€/£ short doing good...free trade stops moved to b/e

€/y entry ready
  • #7,591
  • Apr 14, 2009 4:21am Apr 14, 2009 4:21am
scratch the €/y entry don't fancy it against the trend as i see it
  • #7,592
  • Apr 14, 2009 5:07am Apr 14, 2009 5:07am
Since I mainly trade off of support and resistance levels I will show an example of where I would use DIBS as a low risk entry point as a supplement to the main reason to take this trade.

I entered this trade about three hours ago so it is going now.

First I look at the weekly chart to find major s/r areas and mark trendlines on it and the daily chart. There is no sense taking a short trade that is falling right into nearby resistance, etc. So with s/r marked and trendlines I have some idea of what direction price may be headed and what the potential may be for profit.

These charts will explain it better than I can in words.

The first chart is a D1 with the recent s/r areas marked in blue. The trend line running upward from left to right is about 120 days long. The downtrend line is from the second most recent daily swing high until now, about 7-10 days. I have indicated my logic on why I would be looking for a low risk, high probability trade at this point.

The second chart is the hourly where I would start to take DIBS entries. I would continue to take every entry offered until the technical picture changed and made this setup invalid.

I would look to take profits at the resistance zones marked or trail the stop.

I'm not going to say that by doing it this way you will always have winners. Not hardly. But if you only take the trades that look like the highest likelihood of success you may be able to be profitable over the long run, especially if you cut your losses and let your winners run.

I hope this helps some people be more successful traders.
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  • #7,593
  • Apr 14, 2009 5:28am Apr 14, 2009 5:28am
Let's not forget that DIBS can also be used in the short term.

I imagine there are 2 types of trader. Those who depend on trading for a living, and those who want to grow their bank balances who 'can afford' to wait for the runners.

From Peter Crowns:

"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."

What I'll do is open a second demo. Trade one long term, waiting for the runners, and trade the other short term and see which suits me best.



  • #7,594
  • Apr 14, 2009 6:43am Apr 14, 2009 6:43am
Quoting PistolDave
Since I mainly trade off of support and resistance levels I will show an example of where I would use DIBS as a low risk entry point as a supplement to the main reason to take this trade.
Yes, looks like we're both on a similar wavelength.

Here's an example of a 'short-term' long I took. Price broke the 1HR trendline upside, in conjuction with an IB. Price stalled then retraced a little at the 4HR & Daily trendlines, (the thicker line, they just happen to be the same!), so I took profit of around 30 pips.

...
Attached Image
  • #7,595
  • Apr 14, 2009 6:45am Apr 14, 2009 6:45am
Quoting icarusfx
morning all, hope everyones weekend was good!

€/£ short doing good...free trade stops moved to b/e
stop move to lock +3%
  • #7,596
  • Apr 14, 2009 6:55am Apr 14, 2009 6:55am
Quoting icarusfx
stop move to lock +3%
Nice. I'm in that trade also.

Price had broken the 4HR and Daily S/R, (trendlines), prior to breaking to the downside of the IB, so no hesitation in getting in on that one.
  • #7,597
  • Apr 14, 2009 7:00am Apr 14, 2009 7:00am
EUR/USD showing IB for a downside breakout. Price has broken 1HR trendline, so will take that one for a reasonably small risk.
  • #7,598
  • Apr 14, 2009 7:02am Apr 14, 2009 7:02am
Agree, but just nervous aboutgetting chopped up by the 1330 figures
  • #7,599
  • Apr 14, 2009 7:11am Apr 14, 2009 7:11am
Quoting foredog
Agree, but just nervous aboutgetting chopped up by the 1330 figures
Actually, I've just redrawn the 1HR trendline, and price is now bouncing back up off it. I'd still take the downside IB breakout, though.
  • #7,600
  • Apr 14, 2009 7:12am Apr 14, 2009 7:12am
Quoting takingthepip
Nice. I'm in that trade also.

Price had broken the 4HR and Daily S/R, (trendlines), prior to breaking to the downside of the IB, so no hesitation in getting in on that one.
yeah was pretty much a no brainer! i don't expect much more from the trade and have move stops up... im looking to tp sooner rather than later.

you said your a relatively new trader... well congratulations i've been around a while and it can take people years (if ever ) to grasp the complexities, intricacies and trading nuance that you display. keep it up you'll do grand!

Regards
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