Handels – Strategien mit den Darvas Boxen

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Easy Darvas Box Indicator

Buravchiq

Этот индикатор Easy Darvas Box автоматически обнаруживает и рисует квадраты Darvas на вашем графике на основе определения, которое представил Николя Дарвас.

Huffington Post называет его «The Greatest Ever Retail Stock Trader».

В конце 1950-х годов Николас Дарвас инвестировал 36 000 долларов в 2 250 000 долларов за 3 года.

Меня еще больше шокировало то, что он торговал только частично, читая еженедельные информационные бюллетени Баррона для котировок акций . и используя телеграммы для отправки своих заказов на покупку и продажу своего брокера в Нью-Йорке.

Вся стратегия Дарваса включает только ОДИН образец прорыва: «Шкатулка Дарваса».

Он искал торговлю акциями в узком диапазоне не менее 3 недель. Он купил, когда цена поднялась из коробки. И он поставил стоп-лосс прямо под ящик.

Простой, да. Даже глупо просто. Но если это будет достаточно для крупнейшего в мире торговца розничными товарами, то я все для этого!

Easy Darvas Box также дает вам всплывающие, звуковые и визуальные предупреждения всякий раз, когда цена разрывается вверх или вниз от этих ящиков Дарваса.

The Darvas Box: A Timeless Classic

In the late 1950s, Nicolas Darvas was one half of the highest paid dance team in show business. He was in the middle of a world tour, dancing before sold-out crowds. At the very same time, he was on his way to becoming a now forgotten Wall Street legend, buying and selling stocks in his spare time using only Barron’s weekly newspaper for research and sending telegrams to communicate with his broker. However, Darvas turned a $36,000 investment into more than $2.25 million in a three-year period. Many traders argue that Darvas‘ methods still work, and modern investors should study his 1960 book, „How I Made $2 Million in the Stock Market.“ Read on as we cover the Darvas Box trading method.

Darvas Who?

The path Nicolas Darvas took to stock market riches was unusual. He fled his native Hungary ahead of the Nazis. Eventually, he reunited with his sister and they began dancing professionally in Europe after WWII. When he wasn’t performing, he spent countless hours studying the stock market. He gained an understanding of the fact that stocks are risky and taking profits is the key to riches. (See also: Stocks Basics.)

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Darvas began his trading career in the speculative Canadian stock markets and his first purchase led to a profit of more than 200%. His initial success was short-lived, and the rough and tumble Canadian markets soon took back his profits, and then some. Several years later, he turned to the New York Stock Exchange and brought a trading mentality to the market.

Trading Philosophy

Trading was not easy at that time. Stock investing in the 1950s required a full-service broker. Buying high-quality, dividend-paying stocks was the most common investment philosophy. Commissions were high, and investors favored dividend income over capital gains. Darvas brought his unique techno-fundamental theory of investing to this market, with no consideration of dividends and clearly defined stop-loss points.

To identify trading candidates, Darvas applied a distinctive fundamental filter. He looked for industries he expected to do well over the next 20 years. In the 1950s, electronics, missiles and rocket technology fascinated the American public. Companies in these industries would benefit from revolutionary new products that would lead to exponential earnings growth. (See also: Introduction to Fundamental Analysis.)

In thinking this way, Darvas had learned from his study of stock market history that he could profit greatly if he could anticipate the next big thing. He notes in his book that in the late 1800s, railroad companies ruled Wall Street; a generation later it was automobile companies that represented an emerging technology. Investors were always on the hunt for the something new and exciting. To find stocks with the greatest potential, his research indicated that you needed to find the industries with the greatest potential.

The Strategy

From a developed industry list, Darvas would create a watch list of several stocks from each industry. Because of the commission structure of the day, he focused on higher-priced stocks. With fixed commissions, the cost of trading, on a per-share basis, declined rapidly as the price of the stock increased. While this was of no concern to the buy-and-hold investor, Darvas realized that a significant part of his trading profits would be lost to commissions if he was not careful. Modern day investors can look at stock price as a filter indicating that the company has some stability—very low-priced stocks often stay low for fundamental reasons in today’s markets.

Armed with his list of trading candidates, Darvas watched for a sign that the stock was ready to move. The only indicator he used was volume, watching for heavy volume among his short list of trading candidates. When he spotted unusual volume, he would contact his broker and request daily quotes.

He was looking for stocks trading within a narrow price range, which he defined using a set of precise rules. The upper limit was the highest price a stock reached in the current advance that was not penetrated for at least three consecutive days. The lower limit was a new three-day low that held for at least three consecutive days.

After spotting the range, he would cable his broker with a buy order just above the top of the trading range and a stop-loss order just below the bottom of the range. Once in a position, he trailed his stop based on the action in the stock. In his experience, boxes often „piled up,“ which meant that they formed new box patterns as a stock climbed higher. Each time a new box formation was completed, Darvas raised his stop to a fraction below the new bottom of the new trading range.

Turning a Profit in Lorillard

In trading, a picture is worth a thousand words, and we can look at an example from Darvas‘ book to gain a clearer understanding of his method. In late 1957, Darvas was performing in Saigon, Vietnam (present-day Ho Chi Minh City), and noticed a volume spike in Lorillard Tobacco Co. (since absorbed into British American Tobacco plc). He began following the stock closely by asking his broker to begin providing daily quotes.

Source: „How I Made $2 Million In The Stock Market“ (1960) by Nicolas Darvas

A. He identified Lorillard’s industry and learned that it was selling a lot of Kent and Old Gold cigarettes. While not a technology stock, cigarettes were a growth industry at this time, before the U.S. Surgeon General warning appeared on every pack. (See also: The Stages of Industry Growth.)

B. He bought 200 shares of Lorillard at 27½, as it broke above the box.

C. Unfortunately, his stop at 26 was hit a few days later when the stock price went back into the box.

D. Seeing continued strength reaffirmed his conviction that the stock was going higher, and Darvas repurchased 200 shares at 28¾.

E. Confident in his selection, Darvas bought another 400 shares at 35 and 36½.

F. Continued strength after the drop in February 1958 led to another purchase of 400 shares at 38.

G. To raise money to purchase another stock, Darvas closed his entire position at 57, for a profit of more than 60% in about six months. By comparison, the Dow Jones Industrial Average gained about 7.5% over that same time frame. (See also: Is Your Portfolio Beating Its Benchmark?)

The simple Darvas method used to profit from Lorillard can also work in the current markets. But now the internet has replaced the telegraph, and it also provides real-time quotes, eliminating the need to wait for Barron’s to be delivered on Saturday morning. Spotting high volume breakouts is relatively simple to do, and profits like Darvas made are possible if traders apply his disciplined approach.

The Bottom Line

Much of Nicholas Darvas‘ success stems from his confidence in his trading strategy. He became proficient at managing risk and taking his profit off the table before the position had the chance to reverse.

Darvas Boxes

Hi guys, i’ve develepoed (tried) a indicator to draw davars boxes.

The problem is that the indicator seems to draw the boxes incorrectly can some help me with this?

I’ve followed the instructions on the site, but with no luck

  • Post # 2
  • Quote
  • Dec 31, 2007 5:15pm Dec 31, 2007 5:15pm

According to the link the first state can only be formed by a ‚High‘ whereas Investor R/T’s version of Darvas Boxes will use the ‚High‘ to form State 1 if the previous breakout was to the upside, and conversley, Investor R/T’s version of Darvas Boxes will use the ‚Low‘ to Form the Box Bottom if the previous breakout was to the downside (Reversing what the link says). So if the breakout is through the Bottom of the Box, the Lowest Low is used to form State 1 (Box Bottom), and the next High for State 3 (Box Top). Perhaps I am reading the article wrong or Investor R/T’s version of Darvas Boxes is incorrect?

Also if State 1 is formed and State 2 is formed and State 3 is being formed and the High of the bar forming State 3 touches the Box Top formed by State 1, is State 1 reset to this new bar, and the count begins for State 2 and State 3 again? Also applying the same question to the formation of State 4 & State 5. If, while being drawn, State 4 & the first State 5 touch the Box Bottom formed by State 3, is State 3 reset to the new bar and the count begins for State 4 & State 5 again?

Also is there any good StopLoss/TakeProfit for this style of trading, or the Box Bottom is strictly used for Stops/Profits?

Also is there any verification for entry? Or are all breakouts to be taken?

  • Post # 3
  • Quote
  • Jan 1, 2008 1:33am Jan 1, 2008 1:33am

Nicolas Darvas Box has been modified by Daryl Guppy to fit his strategy in modern times. Not sure what exactly is the difference but I am sure google will have the answer.

Handels – Strategien mit den Darvas Boxen

Any help on finding „darvas boxes“ on mtf format (to metatrader)?

Re: darvas boxes

Any help on finding „darvas boxes“ on mtf format (to metatrader)?

What non-mtf version are you using?

Re: darvas boxes

Any help on finding „darvas boxes“ on mtf format (to metatrader)?

What non-mtf version are you using?

Re: darvas boxes

Any help on finding „darvas boxes“ on mtf format (to metatrader)?

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