The DIBS Method... No Free Lunch continues | Page 435 | Forex Factory

Options

Go to
Permalinks
Print Thread

Similar Threads

The DIBS Method - No Free Lunch Returns 13 replies

No Free Lunch but all the Free Coffee you can drink 736 replies

Peter Crown's DIBS method revisited 14 replies

DIBS Method EA 11 replies

Problem using Dibs EA 4 replies

Attachments: The DIBS Method... No Free Lunch continues
Exit Attachments

The DIBS Method... No Free Lunch continues

  • #8,681
  • Sep 16, 2009 3:05pm Sep 16, 2009 3:05pm
Quoting maxximuz
USD/CHF

Open = 1.0352
Spread = 4

IB High = 1.0374
IB Low = 1.0352

Long at = 1.0379
Short at = 1.0351

Currently, long triggered
Hi, i love that profit target feature you have on your charts (the one with 0.5x, 1x, 1.5x etc) Is it a default tool in metatrader or do I have to download it? If so, could you please post it?
  • #8,682
  • Sep 16, 2009 3:25pm Sep 16, 2009 3:25pm
So what conclusion do I draw from this - the short answer is not much since 40 trades is a small sample size. However a couple of things stand out

 

  1. You should only expect 25%-35% winning trades
  2. Taking half off at 1:1 is too early
  3. The last 3 months has been choppy and making pips has required a careful balance between letting profits grow and then taking them. GBP in particular has been a losing proposition over the last 3 months.

  • #8,683
  • Sep 16, 2009 9:23pm Sep 16, 2009 9:23pm
Quoting ekling
Hi, i love that profit target feature you have on your charts (the one with 0.5x, 1x, 1.5x etc) Is it a default tool in metatrader or do I have to download it? If so, could you please post it?
Hi, I am using the Fibonacci Retracement that come with MT4, and modify the Fibo Level to display the levels accordingly
  • #8,684
  • Sep 17, 2009 1:58am Sep 17, 2009 1:58am
As far as getting to breakeven I've found that there are many ways to do this, and which way depends on the situation at hand.
First of all, I don't think that BE should always be taken at 1:1, it depends on where the next s/r is. For example, if we have a sl of 25pips and the next real s/r is 20 pips away, I could get to BE "safely" by closing half the position at 15 pips in profit and moving the sl on the remaining position to minus 15 pips, that will also give me a BE trade.
Also there is no point in closing half the position size everytime we want to get to BE. We could do it by closing 1/5, 1/4, 1/3 or whatever you would like and thereby letting a bigger positionsize (4/5, 3/4 and 2/3 respectively) run to greater profits. The other side of this coin is that we need to move the sl approprietly just as in the example above. But since we are looking for long tails, we need to leave as big of a position as possible, this will make the overall performance of this system so much greater. And after moving to BE we should be in profits some pips, so moving the sl after closing a part of the position will still give the trade some room to breathe.

I'm attaching this excel sheet. Type in SL pips, BE pips, % of the position to close at BE and the Reward:Risk ratio you are aiming for on the trade. These are all on the left side. In the middle, "Move SL to" gives how far away the new sl should be from the opening price. "TP remaining..." gives you the number of pips you need to be in profit to reach the Reward:Risk that you were looking for.
You can see in the excel sheet that if you type in a sl of 25, BE at 25, and 50% close of the position at BE (which in this case is 1:1, the usual DIBS), you will get that you need to move the sl to 25 pips away from opening price (which means that you don't need to move sl since it's already there), and to reach the R:R of 2, the remaining part (the other 50% of the position) should reach 75 pips in profit, just the usual DIBS basically.

But DIBS is about getting long tails. Let's compare how far we need to be in profit to get a RR of 10 when closing 25% resp 50% at BE. With an initial sl of 25 pips, closing 25% (and moving sl to 8pips after reaching 1:1, which gives a total sl of 8+25=33pips at 1:1 so there's room to breathe) would mean that we would need to reach a profit of 325 pips to get a RR of 10, but when closing 50% at 1:1 we would need to reach 475 in profit. There's a huge difference there.

Anyway just sharing with you people how I do things a little, hope someone can benefit from it. Cheers!
Attached File(s)
File Type: xls DIBS BE Sheet.xls   19 KB | 1,020 downloads
  • #8,685
  • Sep 17, 2009 5:17pm Sep 17, 2009 5:17pm
thank you for your replies

as mentioned ive been learning about forex trading for a few years and have been trying to make it profitable but so far not much success....i have a couple of questions about people trading the DIBBS .....would really appreciate some honest answers...after reading the posts i feel that this system could be the one with hard work and dedication that could be profitable

1) are people actually finding this profitable - and are you able to make a monthly income solely trading this method ( in addition to your normal income ) - that is my goal ! - if so would you be kind enough to share how you have tweaked it to work for you

2) would someone be kind enough as to post the daily trades using this method for a few days - that way i can use it to check against how i have started to use this method and can ask questions based on that.

appreciate the help in advance

just trying to make it work
  • #8,686
  • Sep 18, 2009 5:26am Sep 18, 2009 5:26am
Quoting NowAndLater
As far as getting to breakeven I've found that there are many ways to do this, and which way depends on the situation at hand.
Excellent post NowAndLater. Trade management lesson at its best. Much appreciated.
Thank You very much!

Bluefish
  • #8,687
  • Edited 4:36pm Sep 18, 2009 10:58am | Edited 4:36pm
Quote
Hi, James!

I am glad that someone else is using so simple (and as we can see profitable) trading methodology. I understand that this is your technic, and probably (as I can see) you would not want to share it with us.
But, if you are already succesfull trader, you may forget, how not simple but very tough it was to reach such place in world of profitably trading.
You can see here a lot of people, who want to learn how to trade profitably and consistently. If you did hint us about Inside bars profitably trading (with your methodology), and did...
No problem in asking and you have not offended me. I will take time over the weekend and try to organize my trading rules in a way that you could go and back test for yourself. The point I was trying to make before is the fact that most people will not succeed in this venture/trading because they will not accept the fact that there will be losses. You just cant get away from it. Also even if you are trading correctly(cutting losses and letting your winners run) you still will not make money all the time. This has been a fantastic year for trading currencies but money wasn't made every day or even every month. But since coming back from a two month vacation in Europe my account is up over 37 percent since mid June alone and I trade using only 1/2 units(r=1/2) of yearly starting balance. It takes time doing the same thing over and over until the payout comes back. One must stick with something long enough to see it work. Hope this helps you out somehow.
  • #8,688
  • Sep 19, 2009 6:14am Sep 19, 2009 6:14am
That's excellent work.
Thanks


Quoting NowAndLater
As far as getting to breakeven I've found that there are many ways to do this, and which way depends on the situation at hand.
First of all, I don't think that BE should always be taken at 1:1, it depends on where the next s/r is. For example, if we have a sl of 25pips and the next real s/r is 20 pips away, I could get to BE "safely"...
  • #8,689
  • Sep 19, 2009 6:19am Sep 19, 2009 6:19am
I look forward to your post after the weekend James......and thx for sharing so honestly about your experience you have helped me loads! I guess you must have gotten on either one or both of the little IB's on cable and G/J around 6th June which are still in play!!
Best, J


Quoting james996
No problem in asking and you have not offended me. I will take time over the weekend and try to organize my trading rules in a way that you could go and back test for yourself. The point I was trying to make before is the fact that most people will not succeed in this venture/trading because they will not accept the fact that there will be losses. You just cant get away from it. Also even if you are trading correctly(cutting losses and letting your winners run) you still will not make money all the time. This has been a fantastic year for trading...
  • #8,690
  • Sep 19, 2009 8:05am Sep 19, 2009 8:05am
"I guess you must have gotten on either one or both of the little IB's on cable and G/J around 6th June which are still in play "

can you illustrate which ones these are - really cant seem to find them

thanks
  • #8,691
  • Sep 19, 2009 11:02am Sep 19, 2009 11:02am
Quoting james996
No problem in asking and you have not offended me. I will take time over the weekend and try to organize my trading rules in a way that you could go and back test for yourself. The point I was trying to make before is the fact that most people will not succeed in this venture/trading because they will not accept the fact that there will be losses. You just cant get away from it. Also even if you are trading correctly(cutting losses and letting your winners run) you still will not make money all the time. This...
Sometimes forums tricks novice traders, becoz they hear some traders making some ridicolous percentages per month....saying they are doubling their accounts in one month or making 20-30% per week, dont be fooled by these posts...then new traders start to look for new systems that will make them win 100%....Also some traders only show their winning trades on these forums and never show their losing trades...this misleads new traders who will think that professional traders never lose.

James post is awesome....take note of the words in red and yu can save yourself a lot of mny...trading will involve a lot of losing trades and yu have to be confident enough to keep taking every trade your system gives...even after a string of losses, but new traders look for a new system everytime they have a string of losses.

I had pleasure to know a few fulltime professional traders and they dont win everyday even every month...they have losing months...but they stick to their trading plan.

DIBS is an awesome method...do your own backtesting like James said and yu can see the results for yourself...but yu will encounter a lot of losses...so yu must let your profits run in order to take care of the small losses. This method needs a trader with a very strong physche to trade it becoz there will be a lot of losses and BE trades...so many traders will tend to take their profits quickly after they had experienced a string of losses and guess what that trade yu cut short would have been the best trade of the year for the system...then yu start kicking yourself and wished yu had stayed in the trade.

Thanks James for your awesome post.
  • #8,692
  • Sep 19, 2009 11:21am Sep 19, 2009 11:21am
Does anybody here use DIBS on the daily timeframe? If so, what are your results and what pairs do you trade?

Thank you.
  • #8,693
  • Sep 19, 2009 11:49am Sep 19, 2009 11:49am
Quoting Dreamliner
Does anybody here use DIBS on the daily timeframe? If so, what are your results and what pairs do you trade?

Thank you.
eurusd, gbpusd, usdjpy, usdchf and gbpjpy...135% per yr
  • #8,694
  • Edited 12:28pm Sep 19, 2009 12:28pm | Edited 12:28pm
Quoting Fxtrader
eurusd, gbpusd, usdjpy, usdchf and gbpjpy...135% per yr
Thank you. How long have you traded the daily? And what time do you use for end of day?
  • #8,695
  • Edited Sep 20, 2009 3:42am Sep 19, 2009 4:31pm | Edited Sep 20, 2009 3:42am
Thanks all for the kind words. For many personal reasons I've decided to try to give something back. My family and friends have convinced me that for the most part I've spent the better part of my life as a selfish greedy bastard. The truth be told they were right. So after stumbling across Forexfactory and reading all the comedy here Ive decided to hop in and speak up. Learning to trade was actually pretty easy for me. After college way back in 1994 I was fortunate to land a job at a major bank. Within one year I found my way at a trading desk. While at said job I was a part time flight instructor at a local airport. Long story short one of the original Turtles showed up and wanted to earn their private pilots license. Within a few months I was working for him as a order clerk/trader. It was there that the importance of back testing was brainwashed into me. Also the importance of acquiring the confidence in your methods. It's your confidence that allows you to step up to the plate and place the next trade after 10 maybe even 18 losing trades in a row. It's your confidence in your methods that get you through the losing periods. I've seen losing periods back in the late 90's that lasted up to two years. Throw in the flat go nowhere periods and it's not exactly a walk in the park. But If you persevere the rewards are waiting for you. But lets be real here. I read posts in this forum about people believing and preaching that risking 2,3 even 5 percent of capital is normal to successful trading. Also I see people take perfectly good methods and try to change them to avoid losses. It just amazes me. So if one is willing to listen with an open mind ,do the homework and put in -the time(manual back testing) and accept the reality of trading I will TRY to -offer up some of the wisdom I have acquired through the years. Up until 2003 My methods basically revolved around Break outs. I traded all domestic commodities and financials including the all the major currencies. My largest trades/profits where in Coffee , the collapse of the Russian Ruble ,Yen, 9-11,and of course the last 18 months of shear chaos. Sometime around 2003 I came across the ideal of taking trades of Inside Bars. Shortly after I was trading IB's on the currency futures and then in the Forex. Trading with these methods are some of the most tried and tested methods out there. The key is risk management and order placement not how to avoid losses. Get that straight and you might have a chance. I will post more tm. Oh and I expect someone probably some of those self serving want-a-be's /vendors to question my motives and back ground, Thats fair.. Anyone that wants to join me in NYC or my house in Ct to watch how I trade is welcomed. While the weather holds out I try my best to trade on my boat presently kept in City Island. If your from NYC/CT you know where that is. PM or just call me at 917-578-9986. See you later and let the fun begin.
  • #8,696
  • Sep 19, 2009 4:45pm Sep 19, 2009 4:45pm
Hi,
Sorry got the date wrong completely (it was late at night so that's my excuse!)! I meant 8th August on G/J! Actually 2 IB's you could have taken and been over 1000 pips up by my calculations on a 22 pip risk (almost 50:1).....unfortunately I took just 5:1 profit later in the week as I was trailing it on the 55 period sma which it hit (just) I have attached chart and put arrows above each trade. Around the same time on cable was another trade like this. These are the trades the system was designed to catch I guess but it means taking every DIB to get them and then hanging on,,,,and on....and on!
Enjoy the journey!
Best,
J




Quoting gonnamakeit
"I guess you must have gotten on either one or both of the little IB's on cable and G/J around 6th June which are still in play "

can you illustrate which ones these are - really cant seem to find them

thanks
Attached Image (click to enlarge)
Click to Enlarge Name: g_j ib.gif Size: 32 KB
  • #8,697
  • Sep 20, 2009 10:10pm Sep 20, 2009 10:10pm
Good evening. First post by a newbie to the boards.

I looked through a lot of posts on the DIBS topics and didn't seem to find an answer, so I thought I'd throw my hat into the ring. If it has already been covered somewhere in the 500+ posts on the subject, I apologize in advance for not doing due proper diligence.

Question 1. I see the official definition of an Inside Bar is "a bar with a High that is lower than the previous bar’s High and a Low that is higher than the previous bar’s Low".

Does it matter if that bar closes on an uptick or a down tick?

Question #2. Is there any reason the DIBS method wouldn't work with futures?

Thanks.

Murph
  • #8,698
  • Sep 21, 2009 12:46am Sep 21, 2009 12:46am
Quote
Does it matter if that bar closes on an uptick or a down tick?
No

Quote
Question #2. Is there any reason the DIBS method wouldn't work with futures?
No
  • #8,699
  • Sep 21, 2009 2:02am Sep 21, 2009 2:02am
Hi,
No it doesn't matter what it closes on provided it is at or below the high and at or above the low of previous bar (personally if it is acouple of pips above or below I sometimes take them if they look good setups as does PC so I seem to remember reading). In answer to your second question......if you read PC's last post there was a guy from IBM who tested it successfully in a number of instruments?! I know it doesn't work too well on the hourly indices but is okay on the dailies.
hope this helps.
Best,
J




Quoting MurphyMan
Good evening....
  • #8,700
  • Sep 21, 2009 5:55am Sep 21, 2009 5:55am
Hi James996,

Thank you for sharing and being open about your trading experience. But can i ask that we keep all personal issues (private jets, boats, phone numbers, mansions etc) away from the thread.

All are welcome to keep posting freely and sharing their experiences/knowledge.

Happy trading.

Z

Quoting james996
Thanks all for the kind words. For many personal reasons I've decided to try to give something back. My family and friends have convinced me that for the most part I've spent the better part of my life as a selfish greedy bastard. The truth be told they were right. So after stumbling across Forexfactory and reading all the comedy here Ive decided to hop in and speak up. Learning to trade was actually pretty easy for me. After college way back in 1994 I was fortunate to land a job at a major bank. Within one year I found my way at a trading desk....
11 traders viewing now