Chat with Joe Ross
Chat log from: Wednesday, April 30, 2008
Live Chat with Joe starts Wednesday at 8.00 PM U.S. Central Time! |
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| aslv2000 | Hi everybody |
| JoeRoss joined. | |
| aslv2000 | Hi Joe. |
| JoeRoss | Hi everyone. |
| BrianJ | Hi Joe. |
| JoeRoss | Well the FED did it's duty today. I don't think it's going to help anyone, do you? |
| aslv2000 | Nope. |
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| BrianJ | Nobody in this country. |
| aslv2000 | Joe, may I ask questions on specific aspects of your techniques? I am rather new here and I have yet to learn some things. |
| JoeRoss | One of these days they will have to start raising them to fight inflation, but there are strong signals now that we may end up with deflation |
| JoeRoss | aslv: Sure go ahead. |
| JoeRoss | Hi marsh. |
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| marsh | Hi Joe.. |
| elias | Hello brothers |
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| JoeRoss | Hi kunlex, Hi yan, Hi elias |
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| aslv2000 |
Thank you Joe. You mention in your Day Trading book that you check graphics on several different markets as part of your homework to make a trading plan. Which markets would you recommend to a newbie like me with a US $ 7,000 account to check on? |
| yan | Hi Joe |
| kunlex | Hello Joe |
| aslv2000 | Hi Rperez. Welcome to the group |
| JoeRoss |
aslv: tough question for me to answer. I haven't traded with such a small account in 50 years. Let me think about it, but my first thought is you should be trading spreads so you can get the most mileage out of your margin account. |
| Rperezq | Hi all. |
| JoeRoss | Hi Rperez. |
| Rperezq | Hi Joe. |
| BrianJ | Joe, can you give a brief description of what trading spreads entails? |
| JoeRoss | aslv: right now margins are very high almost across the board in the outright futures. There's not a lot you can do with 7K. |
| aslv2000 | Any ideas on Markets for day trading. I started learning about day trading and have not reviewed spread trading yet. |
| aslv2000 | What about e-minis? |
| Rperezq | I am actually trading the Emini S&P with an account of $6.000 and having a lot of trouble to stay alive, I guess your answer to ASLV applies to me also? |
| JoeRoss | BrianJ: sure. A spread is nothing more than being long one contract or market and being short a similar contract or market. Right now long corn short wheat seems like a nice spread. |
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| JoeRoss |
You are trading the difference in movement of the two and so the risk can be considerably less, with lots of potential and yet low margins. More on our website www.spread-trading.com and we have an online seminar about Spreads, click here for more info on that... |
| BrianJ | So the key is finding the right markets? |
| JoeRoss | aslv: You can try day trading e-minis or currencies. Day trading margins are typically 1/4th those of overnight margins. |
| aslv2000 | ok |
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| aslv2000 | Thank you very much. |
| JoeRoss | rperez: Yes it applies to you as well. |
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| JoeRoss | BrianJ: finding the right markets is one of several keys. You also need to find the right time frame and the the right setups. |
| Theone | In your opinion, what are the pros and cons of trading the Russell 2000? |
| marsh | Joe, what do you think of Global futures day trading margins of $500 for the emini indexes? Is it a bucket shop? |
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| Philippe | Hi from Shanghai to all, hi Joe |
| JoeRoss |
Theone: I like the ER2 very much. It's my favorite market to day trade. The moves are so much better than in ES or NQ or YM. But in August of this year it is moving to ICE and that is not so good. I have heard ICE is not a very good place to trade. So we may have to kiss the Russell goodbye. |
| aslv2000 | Joe, you also mention in your book that we must look for 1-2-3 formations at major or intermediate highs and lows. Can you please explain what you mean by major or intermediate highs and lows? |
| Theone | What are good set-ups for the Russell? |
| JoeRoss |
marsh: If they are offering less than exchange minimum margins, they are surely not registered with the CFTC or the NFA. Maybe there are some new rules that allow them to do that. But I would be afraid of a broker like that. Even IB cannot charge such low margin and they are trading on paper thin commissions. |
| JoeRoss | Hi Philippe. |
| JoeRoss | aslv: I don't know how to explain it in words, and I can't show you a graph on this chat. |
| aslv2000 | Ok. Thank you very much |
| JoeRoss | Theone: 1-2-3s and hooks are good. Cluster breakouts are good. There are a few others, but I can't mention them here. I teach them at the seminars and in private tutoring. |
| marsh | Global Futures says they are registered with the NFA and CFTC. |
| Philippe | Joe, when u short options, or even for spread trading, do u consider the chart of the underlying? even occasionally? or not? |
| JoeRoss | marsh: I suppose it could be. Maybe new rules. I have no way to check it out. |
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| Amathevs21 | Hi Joe. |
| Amathevs21 | Hi everybody. |
| JoeRoss | Phillipe: Absolutely yes. I wouldn't think of trading anything without first looking at the chart. But I don't need to look at the underlying for a spread. |
| JoeRoss | Hi Amathevs. |
| JoeRoss | Hi Joy, I see you made it after all. |
| Theone | Joe:I noticed that your web-site says that your S&P course says is not be used on on other future markets, so is there another course for the Russell? |
| JoeRoss | Joy can you see the screen? |
| Philippe | Ok, thanks. but for spreads, always seems that Andy only -or mainly- focus on the spread chart itself, not really on the chart of the long and/or short underlying.. ? |
| aslv2000 | Joe. I've been having a lot of problems trading the congestions' breakouts. I set my resting orders 1 tick above or below the congestion's limits but most of the time goes up or down to fill my order and immediately turns around against me. Do you have any suggestions to avoid this problem? |
| JoeRoss | Theone: No course for the Russell and a long time ago there was a course for the S&P, but that was for open outcry. I don't know of any other course we have for S&P. |
| JoeRoss | I'm surprised you found such a thing on our website. |
| Theone | I am pretty sure it was because I was looking for a Russell class from your organization. |
| Theone | Also, why is ICE not good to trade on? |
| JoeRoss | Theone: I don't think it's a good idea to marry a market. What you are saying is you want to trade the Russell, but what if it changes, then what will you do? |
| JoeRoss | Theone: I have only heard rumors, but one of the big complaints is the you cannot do certain kinds of orders there that are available on CBOT or CME. |
| Theone | I am just beginning, so I plan to expand, but wanted to get my sea legs first. |
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| JoeRoss | Hi acman. |
| Theone | I also, wanted to get your opinion about pros and cons of the bond market (know you have a course) and the forex market (know you have a course, then I will stop being a question hog? |
| acman | Hello. |
| aslv2000 | Sorry Joe. Did you see my last question? |
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| Philippe | So rushed this chat.. poor Joe doesn't need to do any sport after this... |
| JoeRoss | Theone: Now I know what you mean by "course" You are talking about our methods. They are not courses, they are discretionary trading methods. |
| JoeRoss | Yes we have two for the S&P, and two for the bonds. |
| Philippe | btw, how is the easy bond method doing right now? Are u trading it these days? |
| JoeRoss | Methods are good if you have certain personal characteristics. You need to be flexible and you need to have a lot of discipline to follow the method. You also need to be somewhat creative and adaptive. |
| JoeRoss | Otherwise you will fail with methods. |
| Philippe |
Joe, sorry to repeat my question; for spreads, Andy always seems to focus on the spread chart itself, giving none or little consideration to the chart of the short and/or long underlying.. is that sufficient to proceed like that? Or only when seasonality kicks in? |
| JoeRoss |
aslv: My suggestion is that you take advantage of the problem, which is really a tradable situation. Typically the market movers and market makers will run the stops on one side of a consolidation and the turn around and run the other side. The solution is to wait until they run one side and then get aboard for the run to the other side. |
| JoeRoss | Andy publishes the results in the Easy Bond forum for those who trade the method along. I haven't been trading the method because I've been selling bond options. |
| aslv2000 | Sounds like the intelligent thing to do. Thank you very much for your response. |
| JoeRoss |
Philippe: When I trade spreads I pretty much do the same as Andy. Everything I need to view graphically is the spread chart itself. But I don't know that Andy doesn't look at the individual underlying markets, just because he doesn't show it in Traders Notebook. |
| Philippe | Alright thanks joe. |
| JoeRoss | aslv: You have to turn lemons into lemonade when you trade. |
| aslv2000 | Joe. Would it be true to say that you look for the exact configurations in a longer term chart (10 or 30 minutes) to trade in the short term chart (5 minutes) all the time? |
| aslv2000 | That is absolutely true Joe |
| JoeRoss | aslv: No not true. I don't always use more than one time frame. |
| Philippe | Joe, any goodie for us? any good trade to take which your wise eyes may have detected and ours not ;-) ? |
| JoeRoss | I try to use whatever is needed. |
| aslv2000 | But you prefer the longer term charts over the short term ones for day trading? |
| JoeRoss | Philippe: I mentioned one earlier. If you are not already long corn and short wheat, now is the time to be looking at that spread. |
| Philippe | Thanks Joe, this one is good. |
| JoeRoss | aslv: Yes. I prefer to go as far out in time as I can to find day trades. I will even day trade weekly chart breakouts. |
| aslv2000 | Thanks Joe. I will work harder on the long term charts then. |
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| JoeRoss | I think last week or the week before I gave one in the Chart Scan Newsletter . Was it about Heating Oil? You know I just don't remember. |
| JoeRoss | Hi dwhitey |
| JoeRoss | Hi also to anyone I missed. Sometimes i don't see you come in. |
| acman | Joe, I looked at the weekly CRB and it looks like a double top. Is that about what you are thinking? |
| dwhitey44 | Hi! |
| Larry | Joe, do you subscribe to the idea of using multiple time frames as they call top down analysis? |
| Rperezq | The assumption for trading weekly day charts is that you use need to use wide stops losses, which on a 7K account is impossible. |
| JoeRoss | acman: The commodities are certainly due for a correction. It wouldn't surprise me to see 850 gold. |
| JoeRoss | Larry: I often use top down analysis, but not always. |
| JoeRoss | Rperez: That is a wrong assumption. |
| JoeRoss | The breakout of a weekly high or low can be day traded with no more margin than any day trade. |
| JoeRoss | And the chance for a bigger move is much greater. |
| dwhitey44 | It sounded like the less than decisive comments from the Fed today will allow the commodities to delay their correction for the short term - at least things like Ag, etc. |
| JoeRoss | dwhitey: Good point. They really don't know what to do and the whole thing may cave in on them. The FED never counted on all the derivatives out there, which may be their ultimate undoing. |
| JoeRoss | If I find time I may post some interesting info about how the FED might torpedo itself. Look for it on our forum: "Things you need to know" |
| Philippe |
Joe, as far as I remember, u are active in your local community a lot, and u visit prisons, is that right? Can i ask what u do in this frame? Do you share trading experience? or u "simply" want to be humanely involved? I don't mean to be indiscreet, if u don't want to answer to more personal questions, no problem, thanks |
| Joy | Joe: Good evening! SORRY to be late... it took me a while to log in but I could not see the chat. |
| Joy | Joe: How did your bond options work out? Did you have to cover any call or put you wrote? I wanted to ask you about your general strategy to cover any options that become too close for comfort. |
| JoeRoss | Philippe: When I have visited the prisons, I am there to do Bible teaching. So it is a visit to teach and encourage. |
| Philippe | Ok, thanks Joe |
| JoeRoss |
Philippe: We go into the prison not as a religious organization, but under the title of drug rehabilitation. The prison where I go is a women's prison and all of the inmates have some kind of drug related crime. From being caught in possession all the way to murder, serving a life sentence or waiting for death row. |
| JoeRoss | Joy, can you see it now? |
| Philippe | Thanks Joe, i appreciate ur answer on a more personal topic. |
| Joy | Joe: Yes! THANK YOU! I was reading your description of your wonderful work for the women in prison. I was so moved that I am sorry to have interrupted. |
| JoeRoss | Joy: My bond options worked like a charm. 127 Calls and 114 Puts. |
| Philippe | Who thinks NASDAQ COMP makes it to 2500 in May? |
| Joy | Joe: Thank you! I should have followed your lead trying to write those. Would you mind answering the general strategy question to cover any options that become too close for comfort? |
| JoeRoss |
Actually, it is very interesting the way it all happened. When we decided to go into the prison, they said they had enough church groups going in there and didn't need any others. So we went in as drug rehab. About 3 years ago they stopped letting church groups go into the prison (long story), but they let us keep going. |
| JoeRoss | Joy: I always have a stop in the futures to protect the option, so the only thing that is too close is if the option goes into the money. |
| JoeRoss | For example: I protected the 127 Calls with a stop in the futures about 5 ticks ahead of the Call strike price. |
| JoeRoss | Sometime I will use only 1 tick and sometimes I will put the futures entry stop one or a few ticks above the Call strike. |
| marsh | Joe, I can understand the 114 puts, but the 127 calls seem far away from the market. |
| Larry | Joe; I'm glad to hear you are also a Christian. |
| JoeRoss | marsh they were not far away when I wrote them. I think bonds were at about 121. |
| Joy | Joe: Thank you for the explanation! Also your work to help prisoners says about you and explains why you are so kind and generous to give us your guidance! |
| Joy | marsh: Welcome back! |
| Philippe | Joe, do u expect NASDAQ COMP to go to 2500 in may? Or no expectation (trade what u see ;-) ? |
| marsh | Thanks, Joy |
| Rperezq | In order to trade with spreads, is it necessary to know about the underlying fundamentals? |
| Rperezq | Like season ability, etc |
| JoeRoss | Joy: I'm at that age where helping others is about the only thing that gets me excited. I am also a member of a healing room. People come every week for divine healing. We see many miracles. |
| JoeRoss | Philippe: No expectation about NQ for me. |
| JoeRoss | Rperez: Yes, it is a good idea to know something about the underlying fundamentals, but only to the extent that you see the relationships between the underlying and maybe know something about seasonality. |
| Philippe | Ok, thx Joe. say, as a miracle, could you see Alan agreeing to work out an Options Newsletter? He mentioned WOW is enough, but many of us would really appreciate one, for a daily follow up. |
| JoeRoss | You don't have to know anything about crop conditions, weather or a host of other junk that fundamental traders worry about. |
| Joy | Joe: That IS amazing! It is people like you that make this world a wonderful place. I would love to see the healing room - must be an incredible experience. |
| aslv2000 | Would you say that a newbie with a small account have a lot more chances of surviving in trading working with spreads then? |
| JoeRoss | Philippe: Getting Alan to write an option letter would truly be a divine miracle. Alan is a free spirit. I think a letter or an option advisory would time him down too much. |
| Philippe | Yes, i kinda guessed that.. but a pity, for us, little options traders :-( |
| JoeRoss | Philippe: We tried very hard to find someone to write an option letter, but nobody came through willing to make the commitment. |
| JoeRoss | Joy: It is an awesome experience. Last week we had a young woman blind from birth who began to see after we prayed over her. |
| JoeRoss | One night we had a man with one leg shorter than the other, and the short leg grew out to be even with the other. |
| JoeRoss | He doesn't limp anymore. |
| aslv2000 | Joe. Would you say that a newbie with a small account has a lot more chances of surviving if he trades spreads than daytrading eminis for example? |
| Amathevs21 | Joe: O My GOD Thanks Lord Jesus Christ. |
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| JoeRoss | aslv: yes, that would be my opinion. Spreads have a better chance. |
| kiwidave | Hi I'm late; caught up doing things. |
| JoeRoss | Amathevs: Those are just two miracles of many. |
| JoeRoss | Hi kiwi, nice of you to stop into say hello. |
| dwhitey44 | Joe, which of your books would cover the areas of covered call writing? Answer questions like writing covered options on a stock for a strike price that may be different than the current stock price? |
| Amathevs21 | Hello Acman. |
| JoeRoss | dwhitey: "Trading Optures and Futions" But not specifically for stocks. |
| acman | aslv: The spreads will give you a limit to the loss. For small accounts, look at the 2yr vs 5yr notes. It moves a few hundred in a day and has low margins and so you can do multiples. |
| Amathevs21 | Joe: Did you always see TBN Channel, too. |
| aslv2000 | Ok. Thank you very much for your responses Joe. I have to leave now. Have a nice weekend all of you |
| acman | Hi amathevs. |
| Rperezq | Thanks Joe |
| Amathevs21 | Acman: hello Acman |
| dwhitey44 | Thanks Joe |
| JoeRoss | aslv: Listen to acman. He knows what he is talking about. |
| JoeRoss | Well it is time for me to leave. Until next week, God bless you all. |
| aslv2000 | Thank you very much for the advise acman. I will look on it |
| Larry | God bless |
| Philippe | Thanks Joe, same to you. take care.. |
| Amathevs21 | GOD Bless you Joe, may Lord Jesus Christ always bless you & your families forever. |
| JoeRoss | I only had 1 hour of sleep last night. |
| Theone | Thank you Joe. |
| Philippe | 3 here ;-) |
| kiwidave | See ya later Joe... Sorry for being late |
| kunlex | God Bless you Joe. Thank you. |
| JoeRoss | So I'm really tired. I taught a man for the last 3 days, private tutoring |
| Amathevs21 | See you Joe & take care Brother |
| JoeRoss | Good night everyone. |
Next Chat with
Joe Ross:
Wednesday, May 7, 2008
Time: 8:00 - 9:00 P.M., U.S. Central Time.
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