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The DIBS Method... No Free Lunch continues

  • #9,561
  • May 18, 2010 9:05am May 18, 2010 9:05am
still holding some of that old dibs. i'm gonna try adding to my position instead of taking profit off.

she was up over 600 pips at one point
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  • #9,562
  • May 18, 2010 6:02pm May 18, 2010 6:02pm
+700
  • #9,563
  • May 18, 2010 6:42pm May 18, 2010 6:42pm
Quoting frankkn
+700
Great job on the trade. I took total profit on my last small position at the 400 pip point which overall was a very satisfying trade. I went short again yesterday on an BEOB (different topic) however there was an IB later in the day that could have been traded and it would have done extremely well. It was less than 40 pips risk and the breakout was beautiful and the end result would have been a quick 1:1 and then the rest would be up around 120 pips now.

Chart: Green and Red line weekly high and Low, Blue lines indicate the IBs for the day that could have been traded The first was touch and go with the Lows matching but the 2nd was the better one all round with the small pip risk making the position size and reward better. I was asleep at the time but as mentioned I had a trade short anyways.

Razor
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  • #9,564
  • May 19, 2010 10:05am May 19, 2010 10:05am
hello may i know if i want to start learning to trade with this DIBS method...i should start reading from where....from the first of this thread or the old thread.......thank you.....
  • #9,565
  • May 19, 2010 10:07am May 19, 2010 10:07am
i really like your lines for weekly high/low i'm definitely gonna have to steal that one from you
  • #9,566
  • May 19, 2010 10:11am May 19, 2010 10:11am
hey steven_leo

just read the first post

then know that there were a lot of people who tried to backtest the strategy. as a result of the fact that this strategy is tricky to backtest (something peter crowns thinks may be a good thing) some people don't like it.

in order to make this a profitable strategy, we have to hold our winners and "push" them by adding to our position along the way. that's the part i am working on now.

i am also meditating on the idea that not all dibs are created equal. that's going to come with time and patience. we have to be willing to take tons of losses, and also be willing to not move our stop and to sit on a winner and add to it
  • #9,567
  • May 20, 2010 6:23am May 20, 2010 6:23am
The only real issues I had with PC and hourly DIBS, and this is really just my personal bias, is all the sitting around I had to do waiting for an IB to form on the hourly chart (getting up @ 2 am and just sitting in front of the computer was killing me) and then not being around later in the day to add to the position when another IB formed in the direction of the trend.

Hence I moved to daily charts so I never miss an entry point. I have actually adujsted my sizing technique - more of a fixed fractional approach and no longer take half off at 1:1. On back testing I found I was just giving up way too much by closing half

But what the real point of this post is to emphasis how many traders don't get the idea of long tails - I dare say 90% lack the balls to shoot for it. If you take a look on FF or even the FX professionals on Linkedin, they all seem to want to call the bottom on the E/U and didnt take kindly to the fact that I was calling them fortune tellers when all I was trying to emphasis that price action takes me in and price action takes me out and trying to predict a top or bottom really limits your wins and even worse, it messes with your head (I love when people try to explain that "price should do this" or "I think price will do that" - my response is usually "how do you trade that? - Where is your entry? Where is your SL?) More so than giving up profit when price retraces to hit your SL

So while you can probably use a time based method, a moving average based method for taking profits, i am not sure you can actually have a target.

But at the end of the day, I have no stress trading. This isnt to say I don't like losing, but I don't sit around scratching my head trying to figure out something that probably doesnt have an answer that was visable with foresight

but you and I are pretty much on the same page........maybe its the name.......



Quoting Razor_trader
Long tail is a reference to being an Alpha trader, that is traders who are able to allow trades to mature well beyond the reward point that most get out at. For example- most aim for a Risk to Reward scenario of say 1:2 so they risk say 30 pips and aim for 60 pips. A long tail trader is looking to hold a trade well past 20 x risk so for a 30 pip risk they look to achieve in excess of a 600 pip reward.

It is also one of the important aspects of having a lower that 50% win rate as having a few trades that run with longer tails can maximise the growth....
  • #9,568
  • May 20, 2010 6:46am May 20, 2010 6:46am
Took the IB for the GBP/USD (my pair of choice this week) short and have just secured 1:1. I took the 1:1 at the time because this pair is inside the high and low created Monday (ranging) and I think we will break the low but I am not counting on it. Still it has some room south to gain some more pips before hitting the low so that is a plus.,

Razor
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  • #9,569
  • May 20, 2010 6:53am May 20, 2010 6:53am
Quoting razorboy
The only real issues I had with PC and hourly DIBS, and this is really just my personal bias, is all the sitting around I had to do waiting for an IB to form on the hourly chart (getting up @ 2 am and just sitting in front of the computer was killing me) and then not being around later in the day to add to the position when another IB formed in the direction of the trend.

Hence I moved to daily charts so I never miss an entry point. I have actually adujsted my sizing technique - more of a fixed fractional approach and no longer take half off at...
Absolutly and I agree with the daily charting. I have taken a good number of trades these last few weeks off the hourly and it has been purely because I was at the computer when something looked to be setting up. I missed a few here and there which is what those who need to trade this everyday look for. I have added a good amount of capital just by looking at what is happening and taking the trade. I have had great winners this week and have held them, downsided positions to ensure growth and moved forth.

With the hourly IBs I think it is important to take some profits here and there and that is purely because you position size is multiple times bigger that you would have on a daily, therefore the smaller moves can have big impacts which is much the heart and sole of hourly trading. I am completely with you on the daily outlook. I personally love to see a trade on an hourly and then once it has eclipsed a few trading days then I look to manage it based on what is happening on the daily. If there is a nice, clear PA signal in the oppo direction of the trend/trade then I will look to be more conservative in my profit taking approach and more times than not I will close out. That disqualifies me from the pure long tail methodology but from my view, it would be nice to have a trade that runs for years however I have already in most cases taken a longer profit approach compared to what I would have done 2 years ago, which was always fixed profit and fixed loss (at which point my account always to 2 steps forward and 3 steps back at the best of times).

Take care

Razor
  • #9,570
  • May 20, 2010 7:23am May 20, 2010 7:23am
Quoting Razor_trader
Took the IB for the GBP/USD (my pair of choice this week) short and have just secured 1:1. I took the 1:1 at the time because this pair is inside the high and low created Monday (ranging) and I think we will break the low but I am not counting on it. Still it has some room south to gain some more pips before hitting the low so that is a plus.,

Razor
i showed up a couple hours too late for that one. nice one.

which time zone are you in?
  • #9,571
  • May 20, 2010 7:29am May 20, 2010 7:29am
Quoting razorboy
The only real issues I had with PC and hourly DIBS, and this is really just my personal bias, is all the sitting around I had to do waiting for an IB to form on the hourly chart (getting up @ 2 am and just sitting in front of the computer was killing me) and then not being around later in the day to add to the position when another IB formed in the direction of the trend.
.

yes sir. thats how i feel i woke my tired ass up and saw a golden dibs on gbp/usd that i missed by a couple bars. at least razor (the other one lol) got it!

could DIBS on monday/tuesday be more valuable than dibs later in the week?

if the eu moves X amt per day, do people look at the # of pips it moves per week? if so then wouldn't monday and tuesday dibs get you to FTT faster, and be safer with nicer payout as a result?

just an idea that i just thought of would love to hear what you guys think
  • #9,572
  • May 20, 2010 7:54am May 20, 2010 7:54am
Quoting frankkn
i showed up a couple hours too late for that one. nice one.

which time zone are you in?
It is being painful though. This low of the week is holding up quite strongly and I wouldnt be surprise to see a rise before heading back down with some momentum.

Razor
  • #9,573
  • May 20, 2010 10:06am May 20, 2010 10:06am
the only filter i used in my back testing was not to use IB's that form on Sunday, it was profitable enough in back testing that I didnt get bogged down with anything else. I could be missing the obvious though as I have been known to do that

I also found that on the large time frame, the concept of the hot hand seems to matter less as you are riding larger economic trends that often become country specific, but again I could be mistaken on this.

Currently short 3 positions on the US/YEN (the last position has a huge S/L - you can probably figure out the entry and SL on that one) and one position on the g/u.

If you get it through your head that the goal of trading is to compound your account and not picking highs and lows, then letting some profit slip away from you doesnt become so distressing

I'm glad most people do not understand this



Quoting frankkn
yes sir. thats how i feel i woke my tired ass up and saw a golden dibs on gbp/usd that i missed by a couple bars. at least razor (the other one lol) got it!

could DIBS on monday/tuesday be more valuable than dibs later in the week?

if the eu moves X amt per day, do people look at the # of pips it moves per week? if so then wouldn't monday and tuesday dibs get you to FTT faster, and be safer with nicer payout as a result?

just an idea that i just thought of would love to hear what you guys think
  • #9,574
  • May 20, 2010 12:01pm May 20, 2010 12:01pm
Quoting razorboy
goal of trading is to compound your account and not picking highs and lows
http://www.google.com/imgres?imgurl=...26tbs%3Disch:1
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  • #9,575
  • May 20, 2010 12:08pm May 20, 2010 12:08pm
watch this one it appears a daily inside bar is forming. We'll know at the close
If you think you can or cannot do it you are correct
  • #9,576
  • May 20, 2010 4:57pm May 20, 2010 4:57pm
The power of IB's can be great, but it can be boring and flat too, but right at the moment there is nothing flat about some of the positions i am in,
i have 4 positions running on the aud/usd at the moment, the first was an 4hrIB way back at 8930 last friday, if you where back testing you would look at it and say it didn't work, but it did and is up 800 pips, oops sorry over 800 now!!! this one trade with its risk of 30 pips on the 4hr, is now over 20:1, and that is 1 position, i have another 3 as well, albeit smaller, but i have taken more off the table with those as they have gone.

this has been a momumental fall of 700 pip fall this week for the aussie, how much further can it go???, i think protecting some profits might be in order very soon.

anyway my point is that this method can be very frustrating to trade, but when things go right they can be very nice.
and backtesting is not going to always show you what did work.

happy trading
  • #9,577
  • May 20, 2010 6:40pm May 20, 2010 6:40pm
Well done Geoffrod on thos positions you are in.

Olu
If you think you can or cannot do it you are correct
  • #9,578
  • May 20, 2010 7:01pm May 20, 2010 7:01pm
Quoting geoffrod
The power of IB's can be great, but it can be boring and flat too, but right at the moment there is nothing flat about some of the positions i am in,
i have 4 positions running on the aud/usd at the moment, the first was an 4hrIB way back at 8930 last friday, if you where back testing you would look at it and say it didn't work, but it did and is up 800 pips, oops sorry over 800 now!!! this one trade with its risk of 30 pips on the 4hr, is now over 20:1, and that is 1 position, i have another 3 as well, albeit smaller, but i have taken more off...
The government annouced last week that they are drawing up plans to tax the mining sector 40% of the profits. This is ontop off all other taxes that are already implemented and while it hasnt been passed yet alot of the mining sector is putting on hold further developments which is taking investors out. Alot of the large mines have had huge drops in stocks and the ASX which has been flying since the Sub Prime lows has dropped almost at the same rate. Stupid goverment.

So this could be the tip of the iceberg. If it goes ahead then I would expect to see the AUD where most currencies (major) are heading and that is way south.
Razor
  • #9,579
  • May 20, 2010 7:28pm May 20, 2010 7:28pm
Quoting Razor_trader
The government annouced last week that they are drawing up plans to tax the mining sector 40% of the profits. This is ontop off all other taxes that are already implemented and while it hasnt been passed yet alot of the mining sector is putting on hold further developments which is taking investors out. Alot of the large mines have had huge drops in stocks and the ASX which has been flying since the Sub Prime lows has dropped almost at the same rate. Stupid goverment.

So this could be the tip of the iceberg. If it goes ahead then I would...
i guess time will tell Razor, mean while, i will continue to ride it down

whilst i dont want to get into a political debate, i do agree the government was a little rude with the figure of 40%, but how much money do these companies make out of digging up our country and taking what they want, and some of them are not even keeping there profits in our country from which they make them, i think it makes a bit more sense for a government to get revenue from those that profit the most, instead of relying on the sale of products that slowly and painfully kill people. just my point of veiw

anyway i dont want to start crap here, i understand what you where stating, that the actions of political policy can have a great effect on these money markets. i am only glad i dont have to understand all that tripe to make some money trading it.

cheers
Geoff
  • #9,580
  • May 21, 2010 12:39am May 21, 2010 12:39am
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