X-Rated IBs and OBs
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Thread: X-Rated IBs and OBs

  1. #1
    Hello everybody!!

    I am going to introduce you to a very convenient IB/OB egy. All you need is a naked chart with only one indior (Average Directional Movement Index, ADX).

    Which are IBs and OBs??
    -IB or Inside Bar, is a pub that's completely within the range of the previous bar, i.e. it's a higher low and lower high compared to the pub instantly before it or when it is has a lower high and also an equivalent low and vice-versa.
    -OB or Outdoor Bar, is a pub that has a higher high and a lower low than the pub immediately prior to it. A pub with a higher high and an equal low can be acceptable, and vice-versa. (For example, see post #40)

    --------------------------------------------------------------------------------------------------
    System Explained

    Time frame: 1 hour
    S/L: 30 pips (such as Spread)
    T/P: 40 pips Spread
    Currency Pair: GBP/USD (you may try other pairs, but I only use this)
    Ideal time for trades: 6:00am - 5:00pm GMT
    ADX Indior settings: Default for MT4 users.
    ADX line - Yellow
    DI - Green Dotted -DI - Red Dotted


    Provided an IB/OB has formed, to go:

    Extended
    Wait till the next candle (verifiion candle) has fully formed and is a bull candle. Then, a fantastic entry point would be when the 1st or 2nd candle after the confirmation candle moves 5 pips greater. Additionally criteria should be fulfilled:ADX line (Yellow line) above 40. DI line (Green dotted) crosses above -DI line (Red dotted) ADX line (Yellow line) curving up at entry. Short
    Wait till the next candle (verifiion candle) has fully shaped and is a bear candle. Then, a fantastic entry point would be when the 1st or 2nd candle after the confirmation candle moves 5 pips reduced. Additionally, at this entry stage ONE of the following criteria should be fulfilled:ADX line (Yellow line) above 40. -DI line (Red dotted) crosses above DI line (Green dotted) ADX line (Yellow line) curving up at entry.
    EXCEPTION RULE (LONG): Only time it is possible to enter the market with no confirmation candle is when an IB/OB has shaped and through the creation of the verifiion candle, the ADX line is above 20. And DI crosses above -DI. Look to enter 10 pips above the high of the IB/OB.

    EXCEPTION RULE (SHORT): Only time it is possible to enter the market with no confirmation candle is when an IB/OB has shaped and through the creation of the verifiion candle, the ADX line is above 20. And -DI crosses above DI. Look to enter 10 pips below the low of the IB/OB.

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    Pheww!! I know that was long, but once you read it a couple of times, it is not too difficult to follow.

    Okay. Time for a few cases of the system in action. I know my drawings aren't the best. :


    This is a trade I made today:



    This is a transaction I made on Friday:




    About sums up this post. I'm always looking to improve the system, so please feel free to give me your views on this particular system.

    Thanks and I look forward to the answers!!

  2. #2
    Quote Originally Posted by ;
    Mazdaz,

    currently I'm forward testing a somewhat similar system, where I position myself right into a growing trend using ADX after an interior bar, much as you can.
    What I do diffently is not to wait for any number of affirmation candles after the interior bar. Rather I look at the market direction (EMA60 on current TF and one TF upward ) and place a buy or sell order one pip above or under the high or low of the outside pub.
    SL is your high or low of the exterior bar plus or without spread.
    TP is not a fixed value, rather I trail the place, before a new interior bar (or a range of interior bars) divides its new exterior bar against my place.

    Good luck with your system, I'll be following this thread with interest.

    Ohka
    I also want to trail my stops as the price goes a long way with the same trend, more often than not. However, my broker (Oanda) don't do Trailing Stops.

  3. #3
    Quote Originally Posted by ;
    Nice. I'll try it after.

    Btw theres comparable IB system by James on babypips.com however, your adx indi appears great compare to slow stoch.
    Yeah that looks great too. But I am not a fan of Stochs.

  4. #4
    Quote Originally Posted by ;
    Yeah that looks great too. But I am not a fan of Stochs.
    to your adx yellowish line, for Long and short, both of them the yellow line must be above 40? Or above 40, brief below 40? For the curve both must point upwards?

    For today trade on cable, if utilizing IB with stoch, I'll go brief but the pending order didnt reach, lucky me. This since stoch showing overbought. Compare with adx, you get a long signal.

  5. #5
    Quote Originally Posted by ;
    for your adx yellowish line, for Long and short, both of these the yellow line has to be over 40? Or over 40? For the curve both need to point upwards?
    Yes. Same for both since ADX line indies how strong the trend is, rather than the management of the trend. To be aware of the direction of this trend, look at the DI and -DI lines. If DI is over -DI, then it is an uptrend, and vice versa.

  6. #6
    Trade made on 26/11/07

    This is to show how you can enter the market without DI/-DI cross and only predied on ADX line provided all the other criteria are satisfied.


  7. #7
    Okay more examples.

    Trade created last Thursday!


    Trade created last Wednesday!

  8. #8
    Hello and thanks for discussing

    The question I want to ask what's your trading period? Because I can see many times IB's are forming during Asian session when the market is not so busy with this pair..As for your charts it's seems like trades have been accepted place somewhere between 4-6 %, but maybe I am blind a little so what's your tme zone or do you trade at nighttime?

    Thanks!

    Take good care,


    Edit: Sorry, missed your trading zone in post #1. .

  9. #9
    Just wondering, how can you show a trade that lost?

  10. #10
    This is a indior I found that marks inside pubs and makes them a lot easier to find.

    That I was not able to loe one for outdoor bars, but I will keep looking.
    I am sure there's one out there.
    https://forexintuitive.com/attachmen...8746653450.ex4

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