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The DIBS Method... No Free Lunch continues

  • #10,521
  • Apr 13, 2015 9:34am Apr 13, 2015 9:34am
Quoting California
{quote} As one example of the value of inside bars, the below chart highlights the 10 inside bars that appeared today during the first hour and 40 mins of the crude oil futures session on a 1 minute chart. This is what I trade, so this is why I chose this example. Of the 10 setups, 9 wins and 1 loss. {image}
Have you tried it with the E-Mini Dow with the same setups (also M1)?
  • #10,522
  • Apr 13, 2015 10:05am Apr 13, 2015 10:05am
Quoting Jeg
{quote} Have you tried it with the E-Mini Dow with the same setups (also M1)?
I don't trade YM. But most setups with an edge work on all timeframes and all markets. You might consider looking at trading crude, as the profit potential is significantly greater than the S&Ps or YM. I refer to crude with a futures broker, not crude with a forex broker.
  • #10,523
  • Apr 13, 2015 10:19am Apr 13, 2015 10:19am
Quoting California
{quote} I don't trade YM. But most setups with an edge work on all timeframes and all markets. You might consider looking at trading crude, as the profit potential is significantly greater than the S&Ps or YM. I refer to crude with a futures broker, not crude with a forex broker.
Thanks, I'll give a try. I trade with a futures broker, so it would be a CLK15
  • #10,524
  • Apr 13, 2015 10:28am Apr 13, 2015 10:28am
Quoting Jeg
{quote} Thanks, I'll give a try. I trade with a futures broker, so it would be a CLK15
Yes, CL. The last time I checked, it was about double the volatility of S&Ps (ATR in points times value in $ per point), and most likely YM, and with less noise and more trendiness, albeit far less liquidity. I would stay away from gold, which is triple the volatility of S&Ps, due to its being fairly illiquid (believe it or not). I compared trading 1minute chart of CL vs 1minute chart of EURUSD, and found that the volatility of crude was greater and there were more setups during the first few hours of NY session.
  • #10,525
  • Apr 14, 2015 12:32am Apr 14, 2015 12:32am
For those who still trade this method, could you please help me to find the hot land?


How to determine strongest and weakest markets?
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  • #10,526
  • Apr 14, 2015 2:28am Apr 14, 2015 2:28am
Quoting zghnno
For those who still trade this method, could you please help me to find the hot land? How to determine strongest and weakest markets?
Just a simple rule would be this: The price has left the 20dma and the 20dma is sloping. The 30dma would also work. But it sounds as though you have some work to do.
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  • #10,527
  • Apr 14, 2015 10:45am Apr 14, 2015 10:45am
thanks for the replies. May I just clarify. Correct me if I am wrong, in the original system, PC used open of day as guide to the trend. If say, inside bar formed when price is below open price of day. If price goes up before coming down to activate the sell stop, is it still considered a valid trade? Or once price goes up, we should invalidate the trade? Thanks
  • #10,528
  • Edited Apr 16, 2015 5:02am Apr 15, 2015 3:37pm | Edited Apr 16, 2015 5:02am
Quoting Mattrix83
thanks for the replies. May I just clarify. Correct me if I am wrong, in the original system, PC used open of day as guide to the trend. If say, inside bar formed when price is below open price of day. If price goes up before coming down to activate the sell stop, is it still considered a valid trade? Or once price goes up, we should invalidate the trade? Thanks
Could you post a chart, please?
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  • #10,529
  • Apr 17, 2015 11:44am Apr 17, 2015 11:44am
Quoting smikester
{quote} Could you post a chart, please?

hi smikester, please see below chart of USDCHF. i can't remember the exact setup which I am referring to, but the actual chart is a good example. please see the red arrow, where there is a IB, and this IB is below the open price of the day. But next candle went up above the high of the IB.. of cos we are looking for shorts only; but does the up spike invalidate the taking of any shorts?
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  • #10,530
  • Apr 18, 2015 2:39am Apr 18, 2015 2:39am
Quoting Mattrix83
{quote} hi smikester, please see below chart of USDCHF. i can't remember the exact setup which I am referring to, but the actual chart is a good example. please see the red arrow, where there is a IB, and this IB is below the open price of the day. But next candle went up above the high of the IB.. of cos we are looking for shorts only; but does the up spike invalidate the taking of any shorts? {image}
Hi Mattrix and thanks for the chart. Absolutely not, is my answer. If anything, this is a better formation, in my opinion. It's a type of "Fakey" or Hikakke. You may want to change your stop loss to the (in this case) high. It's a volatility break out strategy so you should make some rule about how long your pending order expiry will be.

There was also a nice one the day before.
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  • #10,531
  • Apr 22, 2015 2:29am Apr 22, 2015 2:29am
I'm not sure how you can use SMA for exit only?

Say you have 100 SMA as an exit, the method might take short for a price above 100 SMA for a down day. So when do you exit in this case?


The only explanation I can think of is that you use SMA for entry and exit...meaning you cannot short if price above SMA.


Am I correct?
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  • #10,532
  • Apr 27, 2015 3:30am Apr 27, 2015 3:30am
Quoting zghnno
I'm not sure how you can use SMA for exit only? Say you have 100 SMA as an exit, the method might take short for a price above 100 SMA for a down day. So when do you exit in this case? The only explanation I can think of is that you use SMA for entry and exit...meaning you cannot short if price above SMA. Am I correct?
Is this post in the wrong thread? From where did you get the above rule zghnno?
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  • #10,533
  • Apr 27, 2015 5:14am Apr 27, 2015 5:14am
Quoting smikester
{quote} Is this post in the wrong thread? From where did you get the above rule zghnno?
No it's not in the wrong thread... both james996 and pinman who listed their trading plans trading DIBS on live accounts, both mentioned using SMA/EMA as an exit.

Even PC mentioned few times that we can use SMA to exit the trades.


So my above question is related to previous posts in this thread.


IF we use EMA for exits surely we need to use it for entries as well. Otherwise it is not possible to use it for exits only.

Let me give an example:

Say you want to use 20 SMA for exit and you have an up day BUT the price is below 20 SMA... So how can you take a long setup and place your stop below SMA when the price is already below SMA?

Something is missing by all who mentioned using SMA/EMA to exit a trade, including PC himself.


Correct me if I am wrong please.
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  • #10,534
  • Apr 27, 2015 6:19am Apr 27, 2015 6:19am
Quoting zghnno
{quote} No it's not in the wrong thread... both james996 and pinman who listed their trading plans trading DIBS on live accounts, both mentioned using SMA/EMA as an exit. Even PC mentioned few times that we can use SMA to exit the trades. So my above question is related to previous posts in this thread. IF we use EMA for exits surely we need to use it for entries as well. Otherwise it is not possible to use it for exits only. Let me give an example: Say you want to use 20 SMA for exit and you have an up day BUT the price is below 20 SMA... So how...
Yes you've got it completely wrong. Just read Pc's first 5 - 10 posts.
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  • #10,535
  • Apr 27, 2015 6:58am Apr 27, 2015 6:58am
Quoting smikester
{quote} Yes you've got it completely wrong. Just read Pc's first 5 - 10 posts.

I don't think so, I read this thread 3 times, and PC posts many times.

I am talking specifically about the "free trade" and how to use MA to exit.

See three quotes below:

Quoting james996
My basic/ core trading rules as promised with some thoughts. 1. I take 1 hr b/o's on the major pairs. eur/usd, gbp,usd, usd,chf, usd/jpy. 2. I start trading between 2 and 3am est. -the worst part of the business!! 3. I use a sma to act as a filter...

Quoting PinMan
My rules: Only a single EMA on the chart, as my exit signal. ...
Both james996 and PinMan live trading - no demo.

Then this one from PC himself.

Quoting PeterCrowns
Some use moving averages, some "turtle-type" stops, others use trendline stops on daily and weekly charts. The key is you. You ultimately decide everything about your trading experience. The way you think is what defines how profitable you will be. You need to let the market pay you. You shouldn't limit what it will give you. -PeterCrowns- {image}


My question is simple, how can you use SMA for exit only? Without using it for entry?

As I showed in my example. Say you want to use 20 SMA for exit and you have an up day BUT the price is below 20 SMA... So how can you take a long setup and place your stop below SMA when the price is already below SMA?
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  • #10,536
  • Apr 27, 2015 7:38am Apr 27, 2015 7:38am
Quoting smikester
{quote} Hi Mattrix and thanks for the chart. Absolutely not, is my answer. If anything, this is a better formation, in my opinion. It's a type of "Fakey" or Hikakke. You may want to change your stop loss to the (in this case) high. It's a volatility break out strategy so you should make some rule about how long your pending order expiry will be. There was also a nice one the day before.
Thanks for the clarifications!
  • #10,537
  • Edited 3:16pm May 4, 2015 2:31pm | Edited 3:16pm
I have a question.

Assuming I have a typical NY close (GMT-4 / -5) broker with no ability to change the platform time zone, can I achieve an equivalent result by:

1) I open the platform on the hourly time frame.
2) I count 10-11 hourly bars from the NY close bar. This should point me from the -4 / -5 bar to the GMT+6 hourly bar.
3) I take such bar close, which should be exactly the same price I'd see if I looked at the daily chart on a GMT+6 chart.
4) At that point I may draw a vertical line and start looking for DIBS entries for 9-10 hours past it.

Would this work?
  • #10,538
  • May 5, 2015 4:23pm May 5, 2015 4:23pm
Quoting PinMan
{quote} I'm interested as to why you'd use this as a filter. Say you are using a 36 or 45 EMA, or even one as low as 20, and you get an entry the right side of the line and for whatever reason (news most likely) you get a big move in your favour that takes you through the MA line. Say this is the start of a nice big trend, such as GBPUSD in the summer of 2008, and you have loads of entries with the trend as each entry goes free and you can add to your position. All these additional entries are on the wrong side of the MA according to this rule....

Old post from PinMan.....Wondering if someone could explain this??
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  • #10,539
  • May 5, 2015 5:29pm May 5, 2015 5:29pm
Quoting zghnno
{quote} Old post from PinMan.....Wondering if someone could explain this??

the above post does not have great relevance with the use of DIBS. Dibs teach you a simple objective entry mechanism. how you manage your winners and the techniques you use to allow those winners to become as big as possible is what makes you a better DIBS trader. but even if you use DIBS as an intra day trading system, you can still maintain a profit factor of 1.5 and above. which is great. of course if you knew how to pile up Free Trades in one direction and convert these h1 entries into Daily or weekly trends you will experience 1:125 type big winners as PC and his mates use to have. "The psychologically hardest thing to do" as PC puts it is converting those free trades into big big winners.

hope it makes sense.
"...Look for 5:1 RR. I can be wrong 8/10 time yet I'm not gonna lose" PTJ
  • #10,540
  • May 6, 2015 12:43am May 6, 2015 12:43am
<p>
Quoting dustbin
{quote} the above post does not have great relevance with the use of DIBS. Dibs teach you a simple objective entry mechanism. how you manage your winners and the techniques you use to allow those winners to become as big as possible is what makes you a better DIBS trader. but even if you use DIBS as an intra day trading system, you can still maintain a profit factor of 1.5 and above. which is great. of course if you knew how to pile up Free Trades in one direction and convert these h1 entries into Daily or weekly trends you will experience 1:125...

I'm just asking how you manage the winners using ema without using the ema as a filter for entries.


Many said they use ema to exit the free runners. None of them mentioned the same ema for entries.
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