Help with Peter Crowns posts

I was reading several posts by Peter Crown.

Excuse my total ignorance but can someone explain "inside bar trading" on the most basic terms.

I'm not even sure what is considered an "inside bar"

I know what the bars look like I know how to basciall read opens and closes from them, but that is it.

I want to understand what he means by "inside bar breakouts" I kept reading but just was not getting it and its probably due to my ignorance with bars.

Thannks,
Coastalfx

an inside bar is a bar that forms and closes (highs and lows are within) the previous bar(s).

PC looked at 1H inside bars. This means he uses a 1 hour chart. An inside bar is a two candle pattern where the hi and lo of the first candle are more extreme than the hi and lo of the second candle.

This means that the second candle is inside the first candle, hence inside bar.

Said a different way: an inside bar's hi and lo are both within the hi and lo of the previous bar.

Once both candles are complete, price will surpass the inside bar's hi or lo. PC enters a trade short a few pips below the low of the inside bar and opposite for longs.

PC's edge wasn't in a candlestick pattern, it was in holding trades for a very long time and adding to winning positions over periods of weeks to months even.

He would set his stop on the other side of the inside bar, and if the distance from his stop to entry was 10 pips, then he would take half his position off the table at 10 pips (+spread). The reason he would do this is, instead of moving your stop to breakeven to have a free trade, if you did what PC does you will still have a break even trade if your stop is hit in its original location.

This is very helpful because your stop is less likely to take you out of a good position upon the retest of your entry.

This is still not all to PC's method. He also had a time filter of 1am EST and would use the price at that time to draw a "line in the sand" and would only be long above and short below.

All an inside bar is, is a period of consolidation that is easily defined and is universally recognizable to all traders on the 1h chart (unlike daily candles which have different starts)

Also PC would only take trades from Frankfurt open to London close.


If you skip any of these you aren't trading his 1h IB method (DIBS)

What great response's thanks guys. I was asking because I am actually working on trading using the equity millipede approach and was curious about Peter Crowns entry method as I'm trying to develop my entry methods.

thanks,
Coastalfx

Hourly IBs with the daily trend, using his money management approach, line in the sand, and early in the day (as defined by him) made me plenty of $. PC wouldn't try to just take trades with the trend, and I would.

The line in the sand (mentioned by frankkn) is important--I wouldn't overlook it. I think this aspect, going long only if price is up on the day and going short only if price is down on the day could be applied to a lot of other methods as well.

You should write, or have someone write an indicator that plots a 24 hr horizontal line beginning at 1am EST every day. Then you'll always know at a glance if price is above or below the daily open. I have one for TradeStation.

To add: (for anyone who is interested in this system)
he did say that he also looks at the Weekly
what I mean by this is that.
his methodology will only make $ if you trade it with the trend
and looking at the trend is pretty obvious
1.5yrs experienced trader should be able to identify a "trend"

for example rn,, GU and GJ are clearly in an uptrend despite the major resistance.
IT'S IN AN UPTREND YOU piece of pie!!!!

it's a freaking clear uptrend. just look at the most recent market structure.

and also he did mentioned that he trails using the SMA(20) on the daily chart

so his exit strategy is either you hit ur SL or hit SMA(20)

DIBS is just a method of sniper entry on a Daily timeframe TREND analysis.

also to add:
1. FOLLOW THE TREND.
2. LET YOUR WINNERS RUN.
3. CUT YOUR LOSSES SHORT.
4. CUT YOUR LOSSES SHORT.
5. CUT YOUR LOSSES SHORT.

now it all makes sense right?
cutting your losses short means having a tight stop.
so you don't stay in a wrong trade for too long.

He kept saying "low risk" too,, and yes, that is what he meant by it.