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The DIBS Method... No Free Lunch continues

  • #10,341
  • Apr 8, 2013 7:03am Apr 8, 2013 7:03am
Thanks for your post. My view is that the compression or consolidation which causes an inside bar is usually coupled with a dynamic break out. That is the key of the method. Therefore, you may consider that the price pressure has been dissipated somewhat in this case.

My advice would be to look at lots of examples, especially where the daily is trending well. Make notes of % gains and how much R : R the second trade should aim for, with a view to collating your data. This is rude quantitative analysis and will set you in good stead for refining your method.
Gone to a better place
  • #10,342
  • Apr 8, 2013 11:19am Apr 8, 2013 11:19am
Quoting winsonsou
I'm wondering should i keep the Buy Stop order there? Or do I just cancel the order.
I would agree with smikester. There are over 10,000 posts in this thread, let alone the prior thread for this strategy. It has all been documented in excruciating detail. It is now up to the trader (you) to take the bull by the horns, roll up your sleeves, and put in the time necessary to backtest the strategy. This will answer questions you have and help refine your approach in terms of when you will exit winning trades, etc.

You might also consider building a risk model, explained here.
  • #10,343
  • Apr 8, 2013 8:38pm Apr 8, 2013 8:38pm
@California & smikester. Thank you both for your replies.

I will continue doing research and demo trading.

Thank you for the link on building a risk model too. I will look into that.

Cheers!
  • #10,344
  • Edited Apr 18, 2013 1:06am Apr 17, 2013 10:28am | Edited Apr 18, 2013 1:06am
Well that was an exhausting but worthwhile read starting from the beginning of the DIBS journey. Many thanks to Peter Crowns for his insights and also to the many others who have assisted in their explanations along the way.

Striving for infinite yield using a selective breakout technique that allows you to stay alive long enough for those rare moments is very appealing to me.

I see the technique as comprising two components.

The gruelling workhorse component of the strategy is the short time frame application of the breakout technique itself and the risk minimisation approach which is designed to maximise the potential of any short term trade undertaken to hopefully be able to join the higher timeframe trend and ultimately turn into a leg for the long journey on a secular trend. This step is key by putting as much possible distance between the trade's position and its stop in as short a time as possible through a high momentum breakout. Every edge that can be achieved to shift expectancy in your favour is essential during this phase such as choosing small range IB's in preference to longer IB's and the relative high frequency of 'selective' trades that can be undertaken using this simple strategy. Another edge explained by Peter was in the use of the 'strong hand'. This seems to have been overlooked by many in this thread. IMO Hanover's post regarding recent strength of currencies was exactly what Peter C was suggesting in relation to 'only trading the strong hand' (a term so familiar to a pit trader that Peter probably thought it was not necessary to explain this in detail to the forum members).

Following the gruelling ride through phase one, this is when the strategy shines. The few trades that survive are the key to positive expectancy. Kick back and relax with these trades and let market forces do their work. Take the journey on higher time frames with a generous stop technique.

Now that was easy....time to stop dreaming and back to work.

PS Love this forum. So many giants with shoulders to stand on.
  • #10,345
  • Apr 17, 2013 10:42am Apr 17, 2013 10:42am
Quoting Copernicus
Well that was an exhausting but worthwhile read starting from the beginning of the DIBS journey. Many thanks to Peter Crown for his insights and also to the many others who have assisted in their explanations along the way. Striving for infinite yield using a selective breakout technique that allows you to stay alive long enough for those rare moments is very appealing to me. I see the technique as comprising two components. The gruelling workhorse component of the strategy is the short time frame application of the breakout technique itself and...
excellent summing up... if i was to add something i would just say, have a look at outside bars too...
tradewith60
  • #10,346
  • Apr 17, 2013 11:09am Apr 17, 2013 11:09am
Quoting 60minuteman
excellent summing up... if i was to add something i would just say, have a look at outside bars too...
Ta 60minuteman, will do.
  • #10,347
  • Apr 23, 2013 1:09pm Apr 23, 2013 1:09pm
I'd like to ask a question using pictures. I hope some of the experienced guys sees this and comment on it. Is it possible that PC might be Long even today on EUR/JPY supposing he was trading it or perhaps USD/JPY as it has done similar stuff.

and now the pictures... In the first picture I spot a NICE Small IB with only 13pips Risk.
Attached Image (click to enlarge)
Click to Enlarge Name: DIBS-EJ1.png Size: 27 KB


In the second picture I show that the trade progressed nicely and now in line with Daily trend so time to use the 20SMA and let it bloody run!
Attached Image (click to enlarge)
Click to Enlarge Name: DIBS-EJ2.png Size: 29 KB


3rd picture shows where we coulda/woulda/shoulda taken profits!
Attached Image (click to enlarge)
Click to Enlarge Name: DIBS-EJ3.png Size: 50 KB



The Question is, did I get it right? and Would we still be long using a slower MA? Kind Regards.... once again Salute to all the contributors and a big hug and thanks to PC!
"...Look for 5:1 RR. I can be wrong 8/10 time yet I'm not gonna lose" PTJ
  • #10,348
  • Apr 24, 2013 3:00am Apr 24, 2013 3:00am
Dustbin, looks like you got the idea. I'm answering not because I regard myself as some kind of expert here, more because you have been waiting for a reply.

I'm not sure if the time of the bar fits in with Peter Crown's method, but the principle is there. Some might say not to move your stops after trailing with the 20dma for a few days. This is entirely up to you, but if you consider that this could go to 150.00 + then you might not be so quick to close just because the 20dma is breached. A respected trader once asked me "Why move your stop at all?" Just let your trade run until the opposite scenario would make you look for trades in the opposite direction. So you could be looking at weekly or monthly charts. That is something I find very difficult.

In any case, the R : R is attractive enough to counteract the sometimes frustrating day to day operation of this strategy. Good luck!
Gone to a better place
  • #10,349
  • May 3, 2013 9:41am May 3, 2013 9:41am
Quoting smikester
Dustbin, looks like you got the idea. I'm answering not because I regard myself as some kind of expert here, more because you have been waiting for a reply. I'm not sure if the time of the bar fits in with Peter Crown's method, but the principle is there. Some might say not to move your stops after trailing with the 20dma for a few days. This is entirely up to you, but if you consider that this could go to 150.00 + then you might not be so quick to close just because the 20dma is breached. A respected trader once asked me "Why move your stop at...

Thank You very much for your response and apologies for my delay in expressing my gratitude.

Having said that I am offering a very timely Thank You and Gratitude for a Lovely Trade I managed today on EUR/JPY. The last 2 weeks have been nothing but patience, some "expenses" (losing trades) and some "returns" (Break-even Trades). A picture I very much like.

Thank You PC!
Attached Image (click to enlarge)
Click to Enlarge Name: ThankYouPC.png Size: 76 KB
"...Look for 5:1 RR. I can be wrong 8/10 time yet I'm not gonna lose" PTJ
  • #10,350
  • May 3, 2013 5:33pm May 3, 2013 5:33pm
Nice EJ chart Dustbin. What's the name of the indicator that's painting your IB bars yellow?

Thank you.
  • #10,351
  • May 3, 2013 8:59pm May 3, 2013 8:59pm
Never quite got to say thank you for what I learnt from here. Glad to see people are still using the system.

One of the truly simple systems out there.

Great man for sharing it.
NineKaye
  • #10,352
  • May 6, 2013 5:02am May 6, 2013 5:02am
Is this a valid setup?
GBPUSD.
Daily opening price at 0600 GMT is 1.5580, yellow line
Inside bar formed shown by greencandle.
Buy order off top of IB, sl off bottom of IB.
Attached Image (click to enlarge)
Click to Enlarge Name: dibs.png Size: 14 KB
author of kissforextrading dot com
  • #10,353
  • May 9, 2013 10:55am May 9, 2013 10:55am
Quoting jicssbr
Nice EJ chart Dustbin. What's the name of the indicator that's painting your IB bars yellow? Thank you.
Sorry for the delay. I used the indicator I found in this thread, i guess. DIBS V1.0

cheer
"...Look for 5:1 RR. I can be wrong 8/10 time yet I'm not gonna lose" PTJ
  • #10,354
  • May 9, 2013 11:06am May 9, 2013 11:06am
Hello Dustbin,

Thanks so much for replying. I spent some time testing the indicators in the thread and believe I found the one you're using. Thanks again. I really appreciate your reply.

Take care.
  • #10,355
  • May 9, 2013 3:05pm May 9, 2013 3:05pm
Quoting jicssbr
Hello Dustbin, Thanks so much for replying. I spent some time testing the indicators in the thread and believe I found the one you're using. Thanks again. I really appreciate your reply. Take care.
You are truly welcome. I'd like to share another DIBS successful trade. I had a few Expense and Break Evens over the past 2 days but then today we got rewarded nicely again. I don't know how I am able to do this. I was not able to hold even 10 pip profits. And now I have suddenly started hitting 100+ pips. I don't know what happened. I just only hope that it continues. Thank You PC!
Attached Image (click to enlarge)
Click to Enlarge Name: UJDIBSGreatTradeThankYouPC.png Size: 37 KB
"...Look for 5:1 RR. I can be wrong 8/10 time yet I'm not gonna lose" PTJ
  • #10,356
  • May 9, 2013 4:16pm May 9, 2013 4:16pm
Yes, that was some move, and I missed all of it. Didn't note the US 30-y Bond Auction news event as an important one. Forex Factory didn't have it as a RED event. My bad. =)

Nice trade Dustbin. Good 4 U.
  • #10,357
  • May 10, 2013 10:34am May 10, 2013 10:34am
Quoting dustbin
{quote} You are truly welcome. I'd like to share another DIBS successful trade. I had a few Expense and Break Evens over the past 2 days but then today we got rewarded nicely again. I don't know how I am able to do this. I was not able to hold even 10 pip profits. And now I have suddenly started hitting 100+ pips. I don't know what happened. I just only hope that it continues. Thank You PC! {image}
Its still going! More Thanks PC! This trade is now over 10% account growth. I don't believe my eyes... But I do...
Attached Image (click to enlarge)
Click to Enlarge Name: 10-05-2013 16-31-06.png Size: 14 KB
"...Look for 5:1 RR. I can be wrong 8/10 time yet I'm not gonna lose" PTJ
  • #10,358
  • May 11, 2013 6:31am May 11, 2013 6:31am
Quoting dustbin
{quote} Its still going! More Thanks PC! This trade is now over 10% account growth. I don't believe my eyes... But I do... {image}
Hold on to it. DIBs is not the only way to catch a trend and if you look at the higher time frames for a clue to the overall trend then you can get lots of these when you get good at it.
Gone to a better place
  • #10,359
  • May 11, 2013 7:39am May 11, 2013 7:39am
Quoting smikester
{quote} Hold on to it. DIBs is not the only way to catch a trend and if you look at the higher time frames for a clue to the overall trend then you can get lots of these when you get good at it.
Thanks for your response. Could you please elaborate further on this point you made "DIBS is not the only way to catch a trend". And if its not too much to ask, "clue to the overall trend"

Kind Regards
"...Look for 5:1 RR. I can be wrong 8/10 time yet I'm not gonna lose" PTJ
  • #10,360
  • May 12, 2013 4:23pm May 12, 2013 4:23pm
Quoting dustbin
{quote} Thanks for your response. Could you please elaborate further on this point you made "DIBS is not the only way to catch a trend". And if its not too much to ask, "clue to the overall trend" Kind Regards
My point was only to say to let your winners run and risk the absolute minimum. For example, I am running a test at the moment on a strategy which is a hybrid of DIBs and the win rate is <50% but:
Attached Image


and

Attached Image
Gone to a better place
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