DIBS Is Alive and Well!

DIBS Is Alive and Well!

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Hello to everyone who has contributedand benefited from this thread. I am very impressed with the size andquality of this major thread on FF.

I've never posted here, but from time to time have checked the progressof this ever burgeoning and vital thread. I can honestly tell you thatmany excellent and clear explanations given in this thread far exceedwhat my personal frustration index could have handled.

You who have contributed can be very proud of your accomplishments,especially because of the difficulty for the "average" desirous traderto become successful. "Successful" in this case means to me someone whocan depend on his trading operation as a quasi-reliable income source.

There is a reason why I'm making this post.

I got an interesting email from a former IBM engineer turned tradernamed Nathan who visited Forex Factory 2 months ago. He read the entirelink of "No Free Lunch but all the Free Coffee..." (and the"NFLbatFC..continues..."), with more than a modicum of disbelief untilhe kept reading and reading, and decided to do something about it.

What impressed me was the work Nathan did before contacting me. Hefollowed the prudent process of "trust but verify". All in all, beforecontacting me Nathan spent more than $3,500 in purchasing data, and 175hours in programming and testing of the concept. He said he would havegiven up after just a few hours but the results of his research keptcoming up better than random, something he had not experienced in hislast 2 years of research of shorter term methods.

He programmed a fast computer correctly (He forwarded me his code) andwent through 14 years of intraday data in the Gbp/Usd, the last tenyears in Eur/Usd, Usd/Jpy and Usd/Chf to see if there was a statisticaledge to the concept above that of random entry with a variable stoploss.

His conclusions: (with his permission)

• His version of DIBS standalone entry with no 1/2 profits taken, exit at trailing stop or entry stop- 3.7 times better than random entry/exits.
• With no curve-fitting necessary he found that virtually any logical trailing method was efficient enough to extract the edge. (moving averages, parabolic trail, time exits, etc.)
• Nathan found that there was another time period as statistically viable as the approximate 6:00 GMT timeframe disclosed in the "No Free Lunch but all the Free Coffee..." thread.
• Nathan tested futures bond, coffee, soybeans,cotton, etc. for out-of-sample testing-- with similar positive results.
• After simulating 18,554 Forex trades he calculates the profit factor of his simple version of DIBS as 1.27. (return of 127 dollars for every 100 dollars risked. With 1/2 profit taking profit factor dropped to 1.21 but the equity curve was substantially smoother making possible greater leverage. Anyone who has done serious market modelling will realize the incredible power available from this size PF.

I was particularly impressed because his results were approximately whatI had determined with even more rigorous modelling over a decadebefore.

Nathan has started trading DIBS live 3 weeks ago with a 50K account andis happy that he got in the big Eur/Usd trade that many of us took lastMonday. The week started off with an inside hourly bar and afterbreaking out to the upside it has done nothing but gone higher. I'mstill long because the market trend turned up over a week ago and mytrail hasn't been hit. (and probably won't for a few weeks)

He asked me to thank the Forex Factory site and all of the otherposters, those with positive and negative opinions, because he figured,"where there is smoke there is fire."

Why did he contact me to pass along the "news"?

He got to the point where better money management became necessary foreffective trading and wondered if I could point him in the rightdirection. I did.

After reading the thread numerous times he's declining all the questionsthat
would be inevitable from his posting especially since the answers wouldall be
the same ones posted in the thread already.

DIBS is obviously still working for some of us.

The Eur/Usd breakout (chart attached) at the beginning of the week was afun trade. I bought Eur/Usd at 1.2906, sold .5 of the position at1.2925 for 19 pips (better than 1:1) and left the stoploss at 1.2890.I'm still long that trade as I write this. Currently Eur/Usd is at1.3687- meaning 781 pips profit from a 16 pip risk.

Thanks Nathan, for the report on your efforts.

And thanks also to the fine individuals who have written to me withbeneficial
input.

Trade on.

PeterCrowns

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