Inside Bar Breakouts

Thanks to Peter Crown in FF for this method. He describe this method as "elegantly simple" and i believe, simple method in trading is best method... He called this method as DIBS – Daily Inside Bars Breakout

Pairs: Gbp/Usd, Eur/Usd, Usd/Jpy, Usd/Chf & Gby/Jpy ..

Daily Trend: Trend is up if the price is above previous day close and the trend is down if the price is below previous day close.

The only 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.

The Only Filter:-

• Only be willing to buy a market if it is up on the day.
• Only be willing to sell a market if it is down on the day...

The Only Tip: You want to be particularly interested in the inside bar breakouts which meet the conditions early in the session, namely the first 9 - 10 hours.

Money Management:-

Risk 1% per pairs then open two trades on each pairs with position size of 0.5% per trade.

Thing To Take Note:

• The european pairs seem to work better than average.
• There are good chances of being in the direction of the main trend because the market should go up a higher percentage of the time when the trend is up and the market should go down a higher percentage of time when the trend is down.
• No trade should be taken before the session opening bar but trade can be taken within the opening session bar if the previous hourly bar is an inside bar.
• What is good about the DIBS method is that after you get entered you can usually go to sleep. Either the trade will go 1:1 (or whatever your target figure is for 1/2 of your position) or it won't and you will get stopped out.
  
• The trade is simple and perverse at the same time. It also gives some of the best risk/reward trades possible and always ensures that you are with the daily trend.
  
• Each trade is handled separately. If I turn it into a "free trade" by dropping off half @ 1:1, I let each trade ride or get stopped out by the existing stop. The trade has to stand on its own, or be stopped out!
• These simple trades is the tendency to be able to cover your risk quickly by exiting half of your position at 1:1, allowing you to hold the remaining position with the initial stop (the other side of the inside bar) as a virtual "free trade".
• In a larger term time frame you can stack on quite a position over a period of a few weeks with these "free trades". If the market quickly goes against you, you have the stops already in place. Then it is back to work building these structures up again until a huge move which is your payoff move of thousands of pips on large size.
• If you want to look for IBs in 4 hour charts or daily charts you check to see if you are up or down versus last week's close. Take buys if you are above, sells if you are below..

The secret to success as a trader, in my humble opinion; is finding a very low risk method to enter the markets..., and learn to wait… PeterCrown.