Inside Bar Trading

[oildaytrader]

Re: For illustration purposes only

I find IB trading difficult and get better results by being ultra-picky and demanding confluence.

Here is an illustration of a perfect model setup fuelled by good CAD GDP results. Many IB setups will NOT behave like this but you can see how the winners pay for the losers.

Things to note:
1. CadChf was in an overnight consolidation anyway
2. Two consecutive IBs
3. Confluence of trendline break, MAs, round number support
4. When the IB broke it had momentum and moved immediately in 1 direction

Good post!

Its not just IBS but a combination of indications on t/l , momentum(1/2 atr move) etc which give a high probability set up.One can get all these on higher t/f.

O D T

 

[tomorton]

A little bit more backtesting. Looked at inside days and hikkake over 2009 on 13 markets. Aiming for exit at equivalent to the ID's range from the entry point. 400 ID's over the year in these sample markets. Taking long or short with the direction of the breakout on the next day, and disregarding trend and everything else, 217 profitable (just 54%). A lot of regular opportunities to trade but doesn't look sustainable without some moderation for trend, s/r etc.

However, trading the hikkake patterns, of which there were 123, gave 86 wins (70%), again, without regard to trend, indicators etc. Much more promising.

 

[elitejets]

A little bit more backtesting. Looked at inside days and hikkake over 2009 on 13 markets. Aiming for exit at equivalent to the ID's range from the entry point. 400 ID's over the year in these sample markets. Taking long or short with the direction of the breakout on the next day, and disregarding trend and everything else, 217 profitable (just 54%). A lot of regular opportunities to trade but doesn't look sustainable without some moderation for trend, s/r etc.

However, trading the hikkake patterns, of which there were 123, gave 86 wins (70%), again, without regard to trend, indicators etc. Much more promising.

Hey Tomorton,
Thanks for posting your results, very similar to what I found in backtesting.
I had a friend write an EA to backtest dibs (Hotch on this forum). Took every hourly IB in the direction of the day from London open to 1PM NY time. The win rate was pretty close to 50% but by tweaking the TP points (moving it out to 2xR or 3XR etc) we got lower win rate but much more profitable. Also using filters (distance from an MA and using above or below the MA for direction) enhanced profitability a lot. The key is how you take profit and trail stops.
For some reason EURUSD outperforms hourly all other pairs for IB's
Indices were a disaster, topped and tailed all the time.

Nicola