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The DIBS Method... No Free Lunch continues

  • #9,601
  • May 30, 2010 10:26am May 30, 2010 10:26am
Quoting razorboy
feelings have nothing to do with this
to me (and this is a feeling), feelings and emotions aren't exactly the same thing

i believe that emotions can be a major enemy so i agree with you on that

i also believe that as traders we need a statistically provable (and proven) edge if we are in this for the long haul and want to make money

do you feel as though a feel or feeling for the market is going to hurt your performance because you will miss some big trades that were not taken because of intuition, and that the bad trades not taken do not add up to the big one you missed?

it sounds tricky to program to me
  • #9,602
  • May 30, 2010 10:27am May 30, 2010 10:27am
and mr. razorboy

i would also like to add that i do respect you and have learned from your posts, so please don't take my comments the wrong way
  • #9,603
  • May 31, 2010 12:41am May 31, 2010 12:41am
Quoting frankkn
razorboy

are you addressing your comments about s/r to me?

if so then my response to you is that i have been recently working on a way to "operationally define s/r" in my journal at informedtrades

i took the idea from the friendlier of the two razors we have in this thread

he had the highs and lows of the current week on his chart, so i took that idea and took it a little further by adding last weeks high low and close as well as this weeks open price. i color code them.

i don't use them for entry, i use them to get a visual "feel"...
I have read the next 2 posts so I know that you havent taken too much to heart. The written language can easily be misinterpreted and I am sure RB meant nothing more than to comment from his POV.

S/R's can be a vague concept in that it has many meanings and can be determined by different factors. I use the weekly high and low from Monday to show me where we are on different TFs. Naturally it can be done by the naked eye however I just have it there. I also pay respect to the most recent Daily swing high and swing low and will usually use it to factor trades should the market be near either of these. As RB stated you are not looking and worry about bounces in these areas, what you really want to see is for the market to break through them. If they do and you have positions in that direction what it does for you is gives you more room and some confidence if the area has acted as S/R in the past. It is also a point where I may move profit taking targets to (SL's) for part or whole positions.

In any case the monday High and Low means little in aspects of trading this method other than to help my young eyes. Its only application would come into use with the 4 hourly and daily IBs which I like to take above the high of monday (an up week) or below the low of Monday (a down week). If we are in between then I am looking at a range situation up until a point when the market breaks.

Take care

Razor

PS: dont overcomplicate it too much. In the past many have tried to filter out losses and all such only to find that they filter winners aswell. The initial rules for the 1 hour are still extremely useful. What you will find overtime is that you will see setups appear that offer better "probable" outcomes.
  • #9,604
  • May 31, 2010 9:30am May 31, 2010 9:30am
no negativity was meant at all, but if you are going to be a trend trader, especially a beginning trend trader, without years of experience, the whole S/R concept is silly because it means you are going to predict where the market is going to top out or bottom out.

Your biggest wins will come when S/R lines pop. It may seem hard to understand when you are in the middle of trade that is up 500 pips and you are trying really hard not to close it. But when you have done some back testing and have seen profitable positions of 5 to 8 thousand pips, you get yourself some balls and stick to your positions. Learn how the Turtles traded

So if you can actually operationally define S/R in such a way that it gives you a statistical edge around which you can build a trading system, bravo to you.

Remember the market never changes in that it is always changing - it trends, it ranges, it flat lines, volatility comes and goes, but what will get you through the difficult times is not trying to cherry pick your entries, but a proper money management algo based on the size of your account and the size of the risk you are taking with each position
  • #9,605
  • May 31, 2010 10:46am May 31, 2010 10:46am
hey fellas

i want to apologize for my pissy attitude from recently

when i posted my last couple posts i was eyeball deep in all kinds of bs

as usual razorboy and razor_trader have been patient enough to take the time to help me see straight, i'm very fortunate to have met you guys

i'm very interested in backtesting. razorboy did you say you picked up a program that was a couple hundred that allows you to backtest without code? i was looking through both of your guys' posts and have been learning quite a bit

it must feel pretty damn good to not be "swatting at flies" and to have your own hard work under your belt to back you up
  • #9,606
  • May 31, 2010 3:44pm May 31, 2010 3:44pm
Quoting frankkn
hey fellas

i want to apologize for my pissy attitude from recently

when i posted my last couple posts i was eyeball deep in all kinds of bs

as usual razorboy and razor_trader have been patient enough to take the time to help me see straight, i'm very fortunate to have met you guys

i'm very interested in backtesting. razorboy did you say you picked up a program that was a couple hundred that allows you to backtest without code? i was looking through both of your guys' posts and have been learning quite a bit

it must feel pretty damn good...

Hey Frankkn,
give Forex Tester a look over, it is the one Razor Trader used, i recently bought myself a copy as well.

www.forextester.com
if you are in america it is cheaper than 200
But thats what it cost us downunder at the moment.

Regards
Geoff
  • #9,607
  • Jun 3, 2010 12:08pm Jun 3, 2010 12:08pm
as a small give back I want to encourage new or struggling traders to read and reread these DIBS threads especially the beginning by PC. These threads and some of the very helpful participants have absolutely helped me achieve consistency the last several months that I have never experienced before. I can only think that the reason is that this is simple enough for me to do. It gets you entry in the direction of prices, it keeps your losses small and you let your winners run. I think I am considered an occasional "lurker." I do not participate much. But I can encourage you to try what has worked for me and KEEP IT SIMPLE.
  • #9,608
  • Jun 3, 2010 12:31pm Jun 3, 2010 12:31pm
still holding that one from way back
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  • #9,609
  • Jun 9, 2010 8:44am Jun 9, 2010 8:44am
Quoting lmturek11
as a small give back I want to encourage new or struggling traders to read and reread these DIBS threads especially the beginning by PC. These threads and some of the very helpful participants have absolutely helped me achieve consistency the last several months that I have never experienced before. I can only think that the reason is that this is simple enough for me to do. It gets you entry in the direction of prices, it keeps your losses small and you let your winners run. I think I am considered an occasional "lurker." I do not participate...

thanks to everyone who contributed to this thread

i have backtested it on the EUR/USD for the last 10years!!!!!
i only do manual backtesting cause thats the only thing i can do ^_^

well here are the results:

> ALOT OF LOSSES OVER AND OVER AND OVER AND OVER AGAIN
>an average of 70% increase/year!!!! (despite the losses!!!)

thats all the results that i think matters to anyone

the backtesting opened my eyes on important things

1- cut your losses short and ride your winners
i really cant begin to tell you how important is this one .there is no overstressing this point .this rule is the foundation of this method's success(i really hate the word system,robot,....)

2-Winning percent is meaningless but R/R is gold
it doesnt matter if you win only 1 time and lose 50 times in a row if that one keeps you forward
in my backtest i had~ 10 trades that made 200:1

3-saying that you want to make xxx pips/month,year,day,....

is like telling i kn0w exactly whats going to happen next which isnt basically going to happen.

you should profit as much as the market allows you to no more no less
(during the backtest there were years i reached june with only like 2% gain and then WOOOSH! the market started trending



if you have any questions please ask away

here is a tip pull a pen and a paper and start your test and when you get blown away by the results taking these losses over and over again will stop being that scary
  • #9,610
  • Jun 9, 2010 9:13am Jun 9, 2010 9:13am
What were your exit strategies in your backtests please?

Quoting ezz
thanks to everyone who contributed to this thread

i have backtested it on the EUR/USD for the last 10years!!!!!
i only do manual backtesting cause thats the only thing i can do ^_^

well here are the results:

> ALOT OF LOSSES OVER AND OVER AND OVER AND OVER AGAIN
>an average of 70% increase/year!!!! (despite the losses!!!)

thats all the results that i think matters to anyone

the backtesting opened my eyes on important things

1- cut your losses short and ride your winners
[color=black]i really cant begin to tell you...
  • #9,611
  • Jun 10, 2010 5:30am Jun 10, 2010 5:30am
i have backtested it on the EUR/USD for the last 10years!!!!!
i only do manual backtesting cause thats the only thing i can do ^_^


how do you back test manually, Sir? I mean, with which software? I might be interested in it.

Regards
Patience is magic
  • #9,612
  • Jun 10, 2010 5:48am Jun 10, 2010 5:48am
Quoting muntu ntu
i have backtested it on the EUR/USD for the last 10years!!!!!
i only do manual backtesting cause thats the only thing i can do ^_^


how do you back test manually, Sir? I mean, with which software? I might be interested in it.

Regards

try forex tester 2
  • #9,613
  • Jun 10, 2010 7:14am Jun 10, 2010 7:14am
Quoting fosters
What were your exit strategies in your backtests please?
the secret is the long tail......<< brilliant sentence by THEREALTHING

so to me the more i stay in the better it gets , how to trail is basically up to you

how i do it? well i use weekly swing points .. let me pull out a chart and explain on it , cause i am one of those guys who cant find the correct words to actually explain anything


ok here they are, again sorry for the bad explanations
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  • #9,614
  • Jun 10, 2010 7:19am Jun 10, 2010 7:19am
let me requote that great reply by therealthing a few years ago.
this reply is purely gold (well actually if you read his ~40 replies)
here on FF you will benefit from it gr8tly

Quoting TheRealThing
Since some of the cat is already out of the bag, I thought some perspective might be useful to DIBS hunters.

The secret is in long tails. No pun intended.

The important note to mention here is-- zinc6, in his kind, thoughtful, but extremely revealing exposure of his data, thankfully stopped at 10:1.

Here's the important note:
How about 15:1, 20:1, 50:1, 100:1, 200:1, 300:1..., available for the "long tail" trader?

That is left up to the quiet researcher, who after seeing the actual figures attainable, stops revealing...
  • #9,615
  • Jun 10, 2010 10:11am Jun 10, 2010 10:11am
Hello Ezz,

Thanks for your posts.

That's great work and an amazing result!

It was very kind of you to share your exit strategy. I've had similar results in backtesting using the weekly timeframe but using MAs.

May I ask what kind of drawdown you had and how much risk per trade?

Regards,

- TTP -
  • #9,616
  • Jun 10, 2010 5:01pm Jun 10, 2010 5:01pm
Quoting takingthepip
Hello Ezz,

Thanks for your posts.

That's great work and an amazing result!

It was very kind of you to share your exit strategy. I've had similar results in backtesting using the weekly timeframe but using MAs.

May I ask what kind of drawdown you had and how much risk per trade?

Regards,

- TTP -
i would also like to thank EZZ for his post's, they highlight the great possibilities of this simple method that is somtimes difficult to stomach when going thru the drawndowns that come, I am currently running test's myself on 4hr dibs trading, to find an exit strategy that i am comfortable with, it is a delacate thing, the drawdowns can get quite large even when only riskig1/2% total per trade, and to see your account 40% up and then fade away to 10% up if you are really going for the extra long tails can be gutting. As joel and i think peter may have said before, it is those that have the intestinal fortitude to stick with it that will reap the rewards in the end.
I think RazorTrader has also suggested that looking at higher time frames to see the bigger picture is definitely a step in the right direction in seeing the viability of the current trending situation.

I have been looking at daily and weekly charts in conjunction with the 4hr to find a place i am happy, as i said EZZ has highlighted a great reason to trade this simple method, but people need to know how they will react when they face the opposite to this, the loss after loss after loss, which leads to the terrible drawdown, when you know you can trade thru this part of the method, then the rest is much easier i believe.

sorry for the ramble.

thanks again EZZ for the great post.

Regards
Geoff
  • #9,617
  • Jun 10, 2010 9:48pm Jun 10, 2010 9:48pm
Quoting ezz
let me requote that great reply by therealthing a few years ago.
this reply is purely gold (well actually if you read his ~40 replies)
here on FF you will benefit from it gr8tly
Hey ezz, can i ask if you where testing as per the entry rules peter originally laid out?
ie: only taking the IB that occures within the bracketed time frame ?
also are you taking the ib's long if above the open and short if below?

cheers
Geoff
  • #9,618
  • Jun 11, 2010 2:46pm Jun 11, 2010 2:46pm
i am willing to take an IB that formed b4 the brackted time but broke during the 6:00-----16:00gmt time zone

and yea buy above and sell below
Quoting geoffrod
Hey ezz, can i ask if you where testing as per the entry rules peter originally laid out?
ie: only taking the IB that occures within the bracketed time frame ?
also are you taking the ib's long if above the open and short if below?

cheers
Geoff
  • #9,619
  • Jun 12, 2010 1:58pm Jun 12, 2010 1:58pm
Ezz,
Do you take counter-trend trades then while still trailing the previous ones with the weekly swings?
Quoting ezz
the secret is the long tail......how i do it? well i use weekly swing points ..
  • #9,620
  • Jun 12, 2010 2:15pm Jun 12, 2010 2:15pm
short answer,NO
when i get a tail let's say buy, i only look for more buys

Quoting fosters
Ezz,
Do you take counter-trend trades then while still trailing the previous ones with the weekly swings?
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