Which is the real darvas?

[Gregory Arkadin]

I noticed that there is a canned version Of the Darvas indicator and one called the "Down Darvas" When I use these side by side, I notice they give differing s/l lines. which one is based on the 3 highs/3 lows of darvas before it draws the s/l lines?

Also, is there any way to modify the canned version where the s/l line will change color or print an arrow or dot to indicate when the s/l is official. I notice in the canned version, it will keep drawing lines until it finds a support line

[koganam]

I noticed that there is a canned version Of the Darvas indicator and one called the "Down Darvas" When I use these side by side, I notice they give differing s/l lines. which one is based on the 3 highs/3 lows of darvas before it draws the s/l lines?

Also, is there any way to modify the canned version where the s/l line will change color or print an arrow or dot to indicate when the s/l is official. I notice in the canned version, it will keep drawing lines until it finds a support line

For the full story on this, you might want to read this thread.

ref: http://www.ninjatrader.com/support/f...42688#poststop

Unfortunately, it seems that Nt cannot free enough cycles to tackle it, and I am now unlikely to be able to free enough cycles to tackle it for free either.

[Gregory Arkadin]

For the full story on this, you might want to read this thread.

ref: http://www.ninjatrader.com/support/f...42688#poststop

Unfortunately, it seems that Nt cannot free enough cycles to tackle it, and I am now unlikely to be able to free enough cycles to tackle it for free either.

Does anyone sell a version out there that is accurate that will work with NT?

[koganam]

Does anyone sell a version out there that is accurate that will work with NT?

We have one in beta. Unfortunately, we do not run public beta.

You might want to see if anyone on BMT has maybe written a proper version.

[NinjaTrader_Matthew]

Thanks for jumping in Kognanam,

As discussed, we have plans to revist the development of this indicator in the next major release. For now we can track changes on this indicator using tracking ID # 1079

[Gregory Arkadin]

Thanks for jumping in Kognanam,

As discussed, we have plans to revist the development of this indicator in the next major release. For now we can track changes on this indicator using tracking ID # 1079

So is the main problem that it can mark resistance correctly (using the three lower highs but not support (it marks at 2 higher lows)?

When will the next major release (nt8) be? Is there any use at all for the current incarnation of darvas?

[NinjaTrader_Matthew]

There are a couple revisions of the Darvas, which we haven't updated to his current methods as I understand it.

We do not have an ETA on the next release. I could not answer for you if the current incarnation would work for you. It does not sound like it meets your needs as per the current implementation defined, and if that is the case, then our version might not work as you expect. However if you subscribe to the original description of the indicator, it would work as expected according to that description.

[Gregory Arkadin]

There are a couple revisions of the Darvas, which we haven't updated to his current methods as I understand it.

We do not have an ETA on the next release. I could not answer for you if the current incarnation would work for you. It does not sound like it meets your needs as per the current implementation defined, and if that is the case, then our version might not work as you expect. However if you subscribe to the original description of the indicator, it would work as expected according to that description.

The indicator is not that complicated. From what I read, Darvas originally had where it was three lower highs and then three higher lows (and the lowest low and /highest high is never taken out. That's all it is, if that's what you have currently, than it's alright

The upper edge of the box is formed when the stock retreats from its high and stays below it for three consecutive days. So the move from 25 to 24 did not signal the top of a box as the stock moved up again after that. But when it hit 30, it stayed below that level. After the top of a box is formed, the bottom is formed when the stock advances from a low for three consecutive days without breaking out of the box to the upside. In our example, it is 27. This Darvas would call a 27/30 box which is a pretty tight frame. The depth of the box may vary each time one is formed

source http://breakoutreport.com/articles/s...vasapplied.htm

[Harry]

The Darvas Boxes are not that well defined. I have read the book by Nicolas Darvas, but there are a few parameters which can be set up in several ways.

New Highs / New Lows

The lookback period for a new high or new low can be changed. In case that the lookback period is small, high boxes and low boxes may actually overlap, see chart attached. Darvas did not have this problem, because he traded daily charts in a bull market in the Fifties, and he only traded from the long side. However, a generalization of the concept leads to drawing boxes from new N-day high and new N-day lows.

Countertrend Volatility / Giant Boxes

Sometimes the low of a new Darvas high box can be far beyond the low of the prior upswing, and in some cases it can even be a new N-period low. These cases would not fall within the idea of trading a trend continuation. To eliminate these gaint Darvas boxes additional rules would be necessary such as

-> countertrend move of x times ATR invalidates a potential Darvas high or low
-> new Low invalidates a Darvas high box

Time in Force

If there is no breakout from a Darvas box, it is well possible that there is an occurrence of a new high or low within an existing box. In this case either the first or the new second Darvas boxes should be traded.

Volume Confirmation

Darvas wanted to see heavy volume to get a confirmation for the breakout trade. It needs to be specified how the volume filter can be set up.

Breakout Trades

Long trades can be entered

-> prior to the breakout (define conditions)
-> when the top of a Darvas high box is broken
-> when a close above the top of a Darvas high box is observed.

Similar rules for short trades.

Example

The chart attached points to some of the problems.

[Gregory Arkadin]

The Darvas Boxes are not that well defined. I have read the book by Nicolas Darvas, but there are a few parameters which can be set up in several ways.

New Highs / New Lows

The lookback period for a new high or new low can be changed. In case that the lookback period is small, high boxes and low boxes may actually overlap, see chart attached. Darvas did not have this problem, because he traded daily charts in a bull market in the Fifties, and he only traded from the long side. However, a generalization of the concept leads to drawing boxes from new N-day high and new N-day lows.

Countertrend Volatility / Giant Boxes

Sometimes the low of a new Darvas high box can be far beyond the low of the prior upswing, and in some cases it can even be a new N-period low. These cases would not fall within the idea of trading a trend continuation. To eliminate these gaint Darvas boxes additional rules would be necessary such as

-> countertrend move of x times ATR invalidates a potential Darvas high or low
-> new Low invalidates a Darvas high box

Time in Force

If there is no breakout from a Darvas box, it is well possible that there is an occurrence of a new high or low within an existing box. In this case either the first or the new second Darvas boxes should be traded.

Volume Confirmation

Darvas wanted to see heavy volume to get a confirmation for the breakout trade. It needs to be specified how the volume filter can be set up.

Breakout Trades

Long trades can be entered

-> prior to the breakout (define conditions)
-> when the top of a Darvas high box is broken
-> when a close above the top of a Darvas high box is observed.

Similar rules for short trades.

Example

The chart attached points to some of the problems.

Well I have attached a intraday chart , but it demonstrates a question I had on understanding the darvas box. I know darvas boxes are not ideal for daytrading, but I thought they would be good for identifying congestion as well as support/resistance

based on what I read, it seemed that the box formed when it bounced with three successive higher lows and then bounced down with three lower highs..
I used to have copies of his two last books he wrote in the early to mid seventies, and I think he went into his "dar cards" in the otc version which may have explained the concept more clearly.

If you look at the black circle of the attachment, that is clearly a darvas breakout, but because it reverts upward, a top is not formed for the box. Then it moves up and then down for three successive lows and where the light blue box is, a top is formed. What I don't get is that where the blue circle is, a bottom is formed at the old support level (where the blue circle on the far left is) Shouldn't the support have been formed where the black circle was since it bounced from there? I am trying to understand why the support was drawn above the low (black circle) Then it breaks the high (red circle) moves down with three lower highs and new resistance is formed and then support is formed at the end of the yellow line support is also made because of three higher lows

My main question though is with the canned darvas in NT, why was the support drawn ( second blue circle) above the low (black circle) which I presumed was the real support because of the higher lows?

I think this explanation/pdf and application of the darvas box is the best and makes the most sense. Is there a way to code the darvas like this for the next NT release?

http://www.google.com/url?sa=t&rct=j&q=&esrc=s&source=web&cd=1&ved=0CCwQFjAA&url=http%3A%2F%2Fwww.corporatedoctor.com.au%2Fpages%2Fomnitrader%2Fmanuals%2Fdarvas.pdf&ei=sJfFUoHNLOewyQHH-ICQDA&usg=AFQjCNEjA6REpiipMG3Ba-09MQmRIVvMEA

[koganam]

Well I have attached a intraday chart , but it demonstrates a question I had on understanding the darvas box. I know darvas boxes are not ideal for daytrading, but I thought they would be good for identifying congestion as well as support/resistance

based on what I read, it seemed that the box formed when it bounced with three successive higher lows and then bounced down with three lower highs..
I used to have copies of his two last books he wrote in the early to mid seventies, and I think he went into his "dar cards" in the otc version which may have explained the concept more clearly.

If you look at the black circle of the attachment, that is clearly a darvas breakout, but because it reverts upward, a top is not formed for the box. Then it moves up and then down for three successive lows and where the light blue box is, a top is formed. What I don't get is that where the blue circle is, a bottom is formed at the old support level (where the blue circle on the far left is) Shouldn't the support have been formed where the black circle was since it bounced from there? I am trying to understand why the support was drawn above the low (black circle) Then it breaks the high (red circle) moves down with three lower highs and new resistance is formed and then support is formed at the end of the yellow line support is also made because of three higher lows

My main question though is with the canned darvas in NT, why was the support drawn ( second blue circle) above the low (black circle) which I presumed was the real support because of the higher lows?

To answer your question, NT coded the Darvas indicator, exactly in accordance with the article that they described. Unfortunately, that is where the problem lies. Darvas finally described how to draw the boxes in the second edition of the book, and that description is not what was in that article. That Darvas only talked about the method (in the first edition) without describing how to construct the boxes, is probably why so many tried to figure it out and ended up with complicated descriptions that are now known to be faulty, only because Darvas himself finally revealed how simple the method really was.

However, one must read the book with a pinch of salt. Remember that Darvas was momentum trading long-only in a bull market. Was he really good; or was he smart; or was he just lucky? Regardless, he was successful: certainly more successful than I have been so far. If you read the book though, you will find that on at least one occasion he was all in with his entire account in one stock. Regardless of stop loss placement, is that really a chance that YOU would want to take.

Just my $0.02.

[LTWCI]

I have Think or Swim which also has the Darvas Boxes indicator. The TOS version prints up and down arrows according to when a box cross occurs. I wish the NT version had the arrows because they make a huge difference in understanding when to go long or short. I use Darvas Boxes with 5 minute charts in TOS and most entry signals are accurate.

[NinjaTrader_CodyB]

Hello,
I will submit adding the arrows as a feature ruquest to our development team for consideration to be implemented in future versions of NinjaTrader.