DIBS Galore on Day After BOE/ECB Updates – GBPUSD Gives a Cluster of Opportunities

The GBPUSD is the star of the day and week on the DIBS play. This morning’s sell-off in the GBPUSD came off of a breakout from a price consolidation that formed after the BOE and ECB interest rate updates on Thursday June 9th. The GBPUSD gave us a few patterns with the DIBS that repeat with decent frequency

 

1. Inside Bar Breakout from consolidation on 1H chart

GBPUSD staged a volatile breakout during Asia session on Friday June 10th with price breaking the lows of a 1H DIBS signal bar from June 9th (30-pip range 1.6387 / 1.6357). The trigger didn’t happen until many hours after the signal bar had printed, one nice quality about the signal was that price barely ever reached the highs (6387) during the consolidation period (late NY Session Thursday / start of Asia session Friday). The signal bar appears on the 1H chart (left side) below and is the first bar with a red-line through it after the mid-day sell-off in GBPUSD from June 9th.

 

2. Inside Bar Breakout at London Open on 1H Chart

The next pattern that frequently appears is the inside bar breakout on Friday June 10th on the 1H chart that took place right around the London open. It’s not uncommon for GBPUSD to see a trend move / volatile breakout occur during the Asia session that is then followed up by a brief pause (i.e. the DIBS / inside bar) before price continues to break further in the direction of the original breakout.

 

3. Clustering of Inside Bar signals on lower time frame in middle of a volatile breakout

The 3rd pattern that shows up often is the lower time frame clustering of DIBS. In this case the chart on the right hand side shows the M30 time frame on GBPUSD printing 3 DIBS signals during the London session (all before the 9:30 AM scheduled data release), each of which managed to at least hit for a 1:1 risk reward.

4 DIBS signals AFTER newsflow

The 4th pattern is the “wait until after the news is out” pattern. In this case, the big news was the scheduled interest rate updates from the BOE and ECB on Thursday June 9th. Once the releases had hit the newswires and the price had staged a reaction, there was plenty of time to make plans for possible continuation moves that could be exploited with definable risk….i.e. DIBS signals. For example, the M30 chart has flagged 3 separate DIBS signals, the 2nd one involved about 20pips of risk and was able to hit for 60pips or better of potential reward.

Image001

Check out the E-Book on the DIBS Trading Method

It’s taken a while but I’ve gotten around to posting an e-book that profiles the DIBS Trading Method, you can find it on this blog by clicking on the “Forex Factory 4 Numpties Volume 1″ link above or by clicking on this link:

http://wp.me/P1stdh-1v

 

The DIBS E-book gives an outline of the DIBS trading method that is profiled on blog posts and in the weekly DIBS chart books that I post on scribd.com.

 

I hope you enjoy the read and make use of it by crushing a few pips!

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