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PeterD
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Postby PeterD » Fri Jan 02, 2009 6:34 pm

Hi MightyOne,

Good question regarding the starting Capital, I am planning to start with $5K in a couple a of months (hopefully).

I am planning to probably start with 1 standard lot trading (1:100 leverage), or maybe 0.5 lot at the very beginning.
I would try to risk 1 or 2%, so that would be roughly around (14 pips - 28 pips) if I traded EUR/USD with ratio around 1.4
$400 doesn't look like enough to me, considering that I could be losing 15x in a row at the beginning (less likely but still possible though).

When I read about your ZL post, I think the light bulb went off in my head (crowd psychology).
TRO's price action concept was also something that I thought was great. I still need to get into his numbers, those red/green arrows look very interesting and promising, at least I hope I could use those numbers to increase my probability of the trade going into my direction.

This is just my beginning of Forex trading, I have never traded forex before.
Things come into my mind when trading:
- I will try to keep positive expectancy (number of winning trades doesn't have to be bigger than losing trades)
- Try to find ECN broker, I learned from TRO about FSB (Fixed Spread Bandits).
- I think the key of trading is, you just have to know when to bail out if the trade doesn't go into your direction.

Thanks for the info MightyOne, keep your great posts! I always read your posts.

Peter.

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TheRumpledOne
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Postby TheRumpledOne » Fri Jan 02, 2009 7:39 pm

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Profitable trade!

=======================================


Thanks for the questions in such a logical order.

1. You mentioned earlier that you only buy on up days and sell on down days. You also said that you look for entries in the first 9 hours of a trading day. How soon into the trading day can you determine whether the day is an up or down day and not an outside bar?

I see where the difficulty is. As traders we have no idea if a day will be an "up" day or a "down" day. (Actually, that isn't absolutely correct, but for the purposes of this method it is.)

If you know what the opening price of the day (and the closing price of yesterday) is, you know at any moment if the price is "up" or "down" vs. yesterday's close .

RULE:
For the "Daily IBar Setup" or DIBS Method--- only take an upside breakout of an hourly inside bar if the breakout price is higher than the day's open and downside breakouts of an hourly inside bar only if the breakout price is lower than the day's open.

And as mentioned a number of times before, the resulting trades have a higher potential if they take place in the first 6 - 9 hours of the day.

2. ..., is it just a simple case of waiting for an inside bar to form, then placing an order to the topside (on an up day) or downside (on a down day) and wait for it to be filled?

With deference to my first answer, yes.

3. Are stops on longs placed just below the low of the inside bar and vice versa for shorts, or are you more discretionary with your stops?

Yes. There is no need to be discretionary with the stops.

Where every trader tends to get discretionary is with how they handle the profits. That is one of the beauties of the DIBS method. The trades happen often enough that the opportunities exist for you take similar trades over and over again. If a trader gets comfortable with a take-profit concept and a decent trailing mechanism, incredible things can happen because of the operation of time improving the value of the surviving trades.

It works on various timeframes. I personally would never use it for less than 1 hour bars, but some do use it on 30 or 15 minute timeframes. It would require your having a firm where trading spreads are very small.

About the short trade displayed yesterday entering the EUR/USD which I turned into a "free" trade. I waited and it stopped me out. That is the result of many of these trades, but definitely not all.

If you enter these trades in the direction of a longer term trend, and trail a number of them, the position you can accumulate over a few weeks and months can be tremendous. So are the profits!

-PeterCrowns-
_______________
Last edited by TheRumpledOne on Fri Jan 02, 2009 9:01 pm, edited 1 time in total.
IT'S NOT WHAT YOU TRADE, IT'S HOW YOU TRADE IT!

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Postby TheRumpledOne » Fri Jan 02, 2009 7:49 pm

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TRO2009_MPMM_IBBO_TRADE and TRO2009_MULTIMETER_IBBO will be sent to the people who send donations in 2009.
IT'S NOT WHAT YOU TRADE, IT'S HOW YOU TRADE IT!



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Postby TheRumpledOne » Fri Jan 02, 2009 7:50 pm

I found a free DIBS indicator here: http://www.singaporeforexforum.com/show ... #post11279
IT'S NOT WHAT YOU TRADE, IT'S HOW YOU TRADE IT!



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Postby TheRumpledOne » Fri Jan 02, 2009 8:00 pm

IT'S NOT WHAT YOU TRADE, IT'S HOW YOU TRADE IT!



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Postby MightyOne » Fri Jan 02, 2009 8:08 pm

PeterD wrote:Hi MightyOne,

Good question regarding the starting Capital, I am planning to start with $5K in a couple a of months (hopefully)...

...$400 doesn't look like enough to me, considering that I could be losing 15x in a row at the beginning (less likely but still possible though)...


...This is just my beginning of Forex trading, I have never traded forex before...


Peter.


If you think that you can lose 15x in a row then that is all the more reason to start with $400.
I don't know what your goals are but for the majority of traders it would be some thing like getting to the $1,000 - $2,000 per pip range and making your parents yearly income in 1 day.

MBTrading has lot sizes down to 1,000 currency or 10 cents per pip so it is doubtful that you will blow up unless you didn't know what you were doing in the first place.

If you think that $400 is too little to retire on then that is simply not the case. Even a 1% gain per day will get in you to a $1,000,000 in ~3 years.

You have to ask your self weather you want to SAVE UP $5,000 again if you blow it up.

How would you feel if you lost 50% of your account and were sitting with $2,500?

The point is that when you consider that there are micro lots available and that within 1-3 years of consistent returns you are likely to reach your cap of $1,000 - $2,000 per pip then it becomes quite clear that there is no reason for any trader to start with more than $1,000.

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Postby TheRumpledOne » Fri Jan 02, 2009 8:43 pm

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Bounce!
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Postby PeterD » Fri Jan 02, 2009 8:54 pm

MightyOne wrote:
PeterD wrote:Hi MightyOne,

Good question regarding the starting Capital, I am planning to start with $5K in a couple a of months (hopefully)...

...$400 doesn't look like enough to me, considering that I could be losing 15x in a row at the beginning (less likely but still possible though)...


...This is just my beginning of Forex trading, I have never traded forex before...


Peter.


If you think that you can lose 15x in a row then that is all the more reason to start with $400.
I don't know what your goals are but for the majority of traders it would be some thing like getting to the $1,000 - $2,000 per pip range and making your parents yearly income in 1 day.

MBTrading has lot sizes down to 1,000 currency or 10 cents per pip so it is doubtful that you will blow up unless you didn't know what you were doing in the first place.

If you think that $400 is too little to retire on then that is simply not the case. Even a 1% gain per day will get in you to a $1,000,000 in ~3 years.

You have to ask your self weather you want to SAVE UP $5,000 again if you blow it up.

How would you feel if you lost 50% of your account and were sitting with $2,500?

The point is that when you consider that there are micro lots available and that within 1-3 years of consistent returns you are likely to reach your cap of $1,000 - $2,000 per pip then it becomes quite clear that there is no reason for any trader to start with more than $1,000.


Wow, great insight MightyOne, honestly, my financial life has been very tight right now, I am expecting if my company would give me some kind of bonus in a couple of months, without that money, then I won't have extra money to be invested, that's why I hope there would be some kind of money I am willing to lose for forex trading.

I don't even have $400 that I could afford to lose right now, so whatever figure that comes up in a couple of months is the amount I am going to put into trading.
I totally agree with you, not that I have specific goals, like you said 1% a day would probably make me really happy.

I have a question for you, I am currently experimenting to trade into bigger timeframe right now (15M), I just entered a trade for EURUSD at 1.3845, like I said I am watching 15M timeframe to prevent me from overtrading, I entered the trade from 1M chart, and of course the 1M and 5M chart have waves as different traders have different timeframes, so I saw swings of myprofit ups and downs, from +15 pips to -5 pips, I will try to hold on tight, I noticed the previous low was 1.3825.
The direction of the trade is still on my favor but now I started thinking, would this be the right way as I could probably gain more profit from the lower timeframe swings?
I am currently up +3pips with MAE of around +15pips.
By doing this I was hoping I would not miss a big move if there is any.
Please give me some insights...

Thanks,
Peter

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Postby TheRumpledOne » Fri Jan 02, 2009 9:23 pm

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I like it when new things pay off!!
IT'S NOT WHAT YOU TRADE, IT'S HOW YOU TRADE IT!



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Postby prochargedmopar » Sat Jan 03, 2009 2:19 am

"knowing when to bail out when the trade doesn't go in your direction"

That's been tough for me. I'm 2 days into trading live. My practice was 9 live trades with .1 lot over a 4 day period.
2 days ago I went on a binge and traded 45 times for a total of +93 pips. 62.2% of trades in profit.
Today didn't go so well.
I switched to .2 lots ($2 pip) It's seems like I got behind the price and couldn't catch up. 15 trades from 7a-2p. 10 of 15 (66%) in profit but those five losses were a kicker. (16, 20,ect) I tried to trade just the 1H candle as TRO suggested. It made the day slow and I couldn't resist scalping a couple 1m charts for quick 2's and 4's. I was also trading 3 different currencies which he said somewhere to stick to one until your profitable.
Ended up being down -15pips on the day.
Time to regroup again. This may be simple but it ain't easy, YET.
Pro

BTW,
TRO I listed you as my IB for an MBtrading demo. I've never demoed an account but thought it might be in my best interest being some people seem to be having difficulties with their platform. I also see they are going to have MT4 available soon. Will it be any good to use with an ECN?
#1BODY in direction of profit #2INCREASE lot size Obsessively
My Losses cause me Great Laughter!
Trading Bible here> therumpledone/the-ideas-that-i-trade-by-t3256/page1670

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