Chat with Joe Ross
Chat log from: Wednesday, May 7, 2008
Live Chat with Joe starts Wednesday at 8.00 PM U.S. Central Time! |
| hellboy joined. | |
| JoeRoss joined. | |
| hellboy | Hi |
| JoeRoss | Hi |
| JoeRoss | You can have a private training session until they all show up :-) |
| hellboy | I want to learn to trade ES |
| JoeRoss | ok |
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| JoeRoss | Just make sure you choose a time frame that has enough movement for you to make some money. That is the biggest mistake most ES traders make--they choose too small a time frame |
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| Sherri | Hi Joe! Wow, it's still light out. |
| JoeRoss | Hi sherri |
| JoeRoss | Hi Marsh |
| hellboy | Which one is good? |
| marsh | Hi Joe. |
| JoeRoss | hellboy: You will have to decide that based on your chart management |
| JoeRoss | hellboy: Personally I use the 60 and 30 minute charts for ES |
| hellboy | And how big are your stops? |
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| JoeRoss | Still light here too, sherri. I like it. I like the light. |
| JoeRoss | Hi amathevs |
| amathevs21 | Hi Joe, Hi Everybody |
| JoeRoss |
hellboy: You have to let the market show you where to put your stops. Mine are not always the same size. I test to see how much risk I will have to take before I can reach my objective. Then I know where to put my stop. |
| Sherri |
Joe, I've got definite questions tonight. I'm missing being able to trade the Bonds with the methods, because my software is not adequate. SO... I want to trade the emini Russell. ( see Marsh is here, too, that's good). If memory serves, you said A. that's the best day trading. B. you use 3 min. bars. SO.... figure I'll watch for good formations, and do that. Looks like maybe 7:30 a.m. for a couple hours is good period. (?) And would it be wise to use the other end of a bar as a stop? |
| hellboy | But how do u test it? |
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| marsh | Hi Joy |
| Sherri | I know stop is personal choice. My aim is to keep loss very small. |
| Joy | Hi Marsh, I made it - taking a long time to reinstall Java :-) |
| Joy | Joe: How are you? A lovely evening? |
| JoeRoss |
Sherri: Everything you said is good except the last few words. You cannot position stops that way. It could place your stop too close or too far. What you have to do is find a pattern or a setup you want to trade. Then look to see how much heat you have to take to make X number of ticks. Enough ticks to satisfy you. Once you see how many ticks of risk you will have to take vs how much you can make, you will know where to put your stop. |
| JoeRoss | Hi Joy |
| JoeRoss | Lovely evening, YES! |
| Sherri |
O.K. that's good. At one point, you said it was feasible to just go for a few ticks. That's what I want to do. I'm allergic to loss this spring. I just want a tiny, repeatable profit and out. That's why I looked at the time period, and relative size of the bars to indicate a stop. |
| JoeRoss | Sherri: Assessing risk is the most important step you can take--even before figuring out your objectives. |
| JoeRoss | You can go for a few ticks provided you don't have to withstand more than those few ticks before you take some money |
| hellboy | I thought that stops placed using ATR or some bands, etc |
| marsh | Sherrie, there were very good and clear TTE off of a Rh today in ER2 at 7:42, 8:36, 9:39, 10:27 (wow),. That's just the morning trading. Afternoon, it was more trading range and ledge trading. |
| JoeRoss | hellboy: That is the amateur way of placing stops. It makes no sense to do them that way. |
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| Sherri |
Yes, and it's the hardest. Depends so much on frame of mind. And right now I'm rabbity. (Is that a word?) I don't think I really care of the broker takes half of it in fees. Is that silly? |
| JoeRoss | Hi tony |
| tony | Hello Joe....I hope you're feeling good. |
| amathevs21 | Hi Tony |
| hellboy | What is the proper way? |
| JoeRoss | Feeling fine, tony |
| tony | Matt....have your received it yet? |
| JoeRoss | hellboy: Read what I wrote to Sherri. |
| amathevs21 | Not yet Tony, I am still waiting now. Thanks |
| Joy | Sherri: Thank you for asking the question! I am a newbie and stop placement is more like a myth and art form right now for me :-) |
| Sherri |
Thanks, Marsh. Yeah, I think I saw one or two. I'm gonna try taking just the best instead of knocking myself out overtrading. And then use the configuration itself as my suggestion of stop. If I concentrate on the 3 min. chart, the bars are not going to be that big usually. |
| Sherri | Marsh, is the Russell a "staple" in your trading? |
| marsh | Sherrie: Patience is one of the hardest things for me. Waiting for the best of the best. |
| Sherri | Pretty much don't know it 'til after the fact... |
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| marsh | Sherrie: Yes, I trade the Russell mostly. |
| marsh | Don't know what, Sherrie? |
| marsh | Russell. |
| JoeRoss | Hi sb |
| sb123 | hello |
| sb123 | Joe, do you feel people will continue to buy quality gold...SF? |
| JoeRoss | sb: in the long term, yes |
| Sherri | The best trades. I mean sometimes I see them as they're setting up, and many times, not. And the discrepancy between real time and, say a print out of that time period, is wild. |
| sb123 | Near term...watch dollar?? |
| JoeRoss | According to the gold spread, traders are looking for gold in a trading range for the rest of the year. |
| JoeRoss | Possible the same thing will happen with SF. |
| sb123 | gold spread??? enlighten me... |
| sb123 | New term for me |
| JoeRoss | sb: December gold minus June gold indicates a trading range for gold. |
| sb123 | Thank you... |
| sb123 | What does one look for in the gold spread... |
| marsh | Sherrie: The trades I mentioned had a big move, then a retracement. One way to practice, cover the chart with a sheet of paper and move one bar at a time. Look for big moves then a retracement (i.e. TTE of of a Rh). |
| JoeRoss | sb: If the spread is not trending then traders are not anticipating higher prices for gold. |
| JoeRoss | Of course they can be wrong. |
| Joy | Joe: Is the SF spread the same direction (i.e., long near-term and short longer-term)? OR do you enter the spread position based on where the current spread vs. trading range? |
| sb123 | Oh i see...if trending up...could this indicate gold to rise and vise versa? |
| Sherri | Ah, funny you said that, Marsh. That's exactly what I did 2 years ago. And it did help. Thank you for reminding me. |
| JoeRoss | Joy: You really can't look at an SF spread. There is virtually no trading in the December contract |
| JoeRoss | sb: Yes if long Dec short Jun would rise it would indicate that traders are anticipating higher prices for gold in Dec. |
| Sherri | I think what I'm grappling with is some kind of comfort zone. I don't care if I miss a huge move per se. I just want to make money routinely, day by day. |
| Joy | I think the consistency approach Sherri mentioned is a good principle. Isn't it? |
| sb123 | Joe...so would you look at the 2 closest months for gold as the year progresses...or are Dec/june the standard? |
| JoeRoss | Joy: Consistency is the way you make a living trading. |
| JoeRoss | Sherri: Point of interest: Do you keep a trading log? |
| Sherri | Joe, that "consistency" factor is an art. Thank God we've got you teaching us! |
| sb123 | I think i see it Joe...if further out months are outpacing closer trade indicates gold possibly going higher ... |
| JoeRoss | sb: not the standard. Use 2 months that reflect the time period you care about. |
| sb123 | Ok... |
| sb123 | That's gold Joe...pun intended |
| JoeRoss | There's something that I can teach you if you can hold the questions for a few minutes. It is something that has come up a couple of times tonight in a number of ways. |
| sb123 | Go for it |
| JoeRoss | Here's an example and you can apply it to any setup you care to trade. |
| JoeRoss | Let's say that you notice that every time a Rh is taken out in whatever time frame or market you like to trade--you find that you can easily make 10 ticks. |
| JoeRoss | But you also notice that when they take out the point of the Rh, there is usually a lot of profit taking and the trade moves against you. |
| JoeRoss | It moves against you before you ever reach those 10 ticks that are usually there.. |
| JoeRoss | So you look back at the last 40 times that this has happened and you take an average of how many ticks prices go against you before you are able to realize the 10 ticks. |
| JoeRoss | When you have the numbers, you will then know where you must place the stop. What you have done is to assess the risk. |
| JoeRoss | You then must decide if you can handle that much risk prior to getting your 10 ticks. |
| hellboy | Thanks Joe |
| JoeRoss | But there is a more conservative way to handle the situation: When prices violate the Rh, you must wait until profit taking brings prices against you. Then you enter on the second time through the hook. |
| JoeRoss | You will miss some trades that simply take off heading for the moon, but you will also have the benefit of very little going against you on the second time through. Of course, you do the inverse of that if the Rh is in a falling market. |
| JoeRoss | Are you getting this? |
| JoeRoss | You will always know where to put your stop. |
| Sherri | You enter for the first time on the second time through? |
| JoeRoss | Sherri: That is your choice. 2nd time through is less risk, but you miss some great first time through trades. |
| JoeRoss | First time through you get some great trades, but you have to take the heat of how many ticks they move against you following the breakout of a Rh. |
| JoeRoss | You need to memorize what I've just told you. Make it part of your market understanding. |
| Joy | Joe: Is 'the average' profit taking calculation working because market movers play the game of moving against you within a normal rebound? |
| Sherri | That's kind of what we do with the range break-outs, isn't it? But is that gonna work on a real short term chart? |
| JoeRoss | Joy: market movers take profits at the breakout of a Rh. |
| tony | Matt: Follow what Joe is explaining....this will come when I try to explain this with the PNL. |
| JoeRoss | Sherri, yes it follows the same principle. First time through they run the stops. 2nd time through the stops are further away. |
| Sherri | Yes, I'm going to print it and memorize it. That's part of what I need to improve. I realize, then forget. Realize, then forget. Geez! |
| Sherri | Thanks so much, Joe. |
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| kiwidave | Hi everyone |
| JoeRoss |
Sherri: You need to keep a trading log. You put info like this in it. You also won't forget what Marsh told you. There is no excuse for not remembering if you keep a log. In essence, marsh was telling you the same thing. Look to see how much prices retrace. |
| marsh | Sherrie: Maybe you could have it tattooed somewhere. |
| Sherri | One thing I have to realize in my own personal trading is that I'm not a real fast person. I pretty much have to have a grip on what I'm seeing and doing. |
| JoeRoss | Hi dave |
| amathevs21 | Tony: Thanks Tony |
| sb123 | Put on some trades at break out...if faded and have chance for second time through add more contracts?? |
| Sherri | Yeah, Marsh, maybe the golden retriever would oblige. |
| JoeRoss | Sherri: I am also painfully slow at some things. |
| JoeRoss | sb: You could do it that way, but I wouldn't because I am not a believer in adding on. |
| marsh | sb: what if the fade is a huge loss? |
| sb123 | That's what our stop is for...i see your point though...we all have been burned... |
| Sherri | sb, be careful of wishful thinking. It's so seductive... |
| kiwidave |
Joe, I sold some and then I added on this is last week and i got burned. A good lesson in why adding on is not a good idea.... I have changed my approach and now just take profits as quick as I can and cover. If I get stopped out so be it. It's now working for me. |
| JoeRoss |
Technically speaking there is no such thing as adding on. You can only add a new position. And that position has all new risk and is closer to the end of the move. |
| marsh | As opposed to holding on and adding later, why not get out of the trade with profits or a small loss, then reenter later at the next good signal, in the direction or the last trade or the other way. |
| JoeRoss | I'm with you on that, marsh |
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| Wagner | Hello |
| Wagner | Joe |
| marsh | I think one of the hardest things in trading is taking a small loss and getting in again on the next signal. |
| Sherri | It is perennially interesting to me how in trading, like so much other analysis in life, swings from one extreme to the other. |
| JoeRoss | Hi Wagner |
| kiwidave | Yes how right you are. Using a trading log when reading back over it makes you think in a more calm situation of why did I do that |
| Wagner | Joe, what do you think about the investment grade in Brazil, more money here? |
| Sherri | Well, Kiwi, I can tell you I have kept a little log for quite a while. But sometimes (when it's most important) I'm so disgusted with my mistake, I don't make the entry.... |
| JoeRoss | Wagner: Brazil will be the next bread basket of the world. |
| JoeRoss | Lots of money pouring into Brazil. |
| kiwidave | It's a weird thing reading back over it "A" |
| sb123 | Any grain traders here...i live in midwest...Oklahoma...been getting rain every 3-4 days...concensus for corn?? |
| marsh | Joe, what's a good way to trade Brazil? |
| JoeRoss | Consensus for corn--going higher |
| JoeRoss | Reading your log is a must. |
| JoeRoss | Unless you are like me who can't read is own writing. Thankfully I can do it on a computer. |
| tony | Joe....Brazil will be the worlds biggest chicken producers....and a few other things as well....no room here to explain.; |
| Joy | Joe: I am interested in marsh's question too - idea to trade into Brazil? |
| Sherri | O.K., so now I've got: read your log, primal scream, reread the tattoo on the dog, reenter... |
| JoeRoss | marsh: You can buy reals or trade Brazilian stocks. You can google for Brazilian stocks that trade as ADRs here in the U.S. |
| JoeRoss | You can also buy farm land in Brazil |
| Joy | Joe: Is the liquidity good for reals or those ADRs? Maybe I should take early retirement and live in a farm in Brazil? |
| tony | Joe....you're right on about farm land.... |
| marsh | If it's oceanfront farm land, I might be interested. |
| sb123 | gees ....currencies are dropping like a rock just last 5 minutes...yikes |
| kiwidave | Joe: I wonder why the really embarrassing things we do stick in our mind for longer than the good things we do. Sherri; We all try to forget the really bad things we do but some how they seem very vivid |
| amathevs21 | sb123: what currencies pairs? |
| Joy | marsh: If you can find an oceanfront farm land, can I co-invest or rent off your land in Brazil? |
| JoeRoss | Joy: You can't really trade reals in the U.S. You just have to buy them and hold them at a bank like Everbank. |
| sb123 | SF...Euro... |
| Joy | Joe: THANK YOU! And what happened to currencies? |
| JoeRoss | My 9550 SF Calls look like a sure thing with that drop. They expire on Fri. |
| tony | According to my chart....the dollar is going up. |
| amathevs21 | sb123:wait - brb |
| JoeRoss | :( I'm afraid some of our students jumped the gun and sold 9400 Puts. They must be sweating blood right about now. |
| sb123 | Dollar was a delay...how funny |
| kiwidave | Haha still on the Friday expiry thing thing Joe; don't forget plan if it doesn't you may have to defend it again like once before. |
| tony | My chart shows the Eur/Dls....is at 1.5296 |
| JoeRoss | Those currencies are dumping because there is now an indication that Trichet may have to lower interest rates. |
| Joy | So the afternoon rumor has something in it! |
| JoeRoss | dave: I don't have any Puts, just 9550 Calls. |
| sb123 | Trichet?? |
| Sherri | When is the ECB meeting? |
| JoeRoss | Joy, yes I read about it after the chat. |
| JoeRoss | Trichet is head of the European Central Bank--equivalent of Bernanke. |
| sb123 | Thx |
| JoeRoss | I have to go now. |
| JoeRoss | It's after my bed time ;-) |
| Joy | Now Joe: How did your students not follow you and sold puts? Rebel against the wise mentor? I will never do that :) |
| JoeRoss | There is something I want to watch. |
| kiwidave | Same catch ya all later |
| Sherri | O.K. Thanks ever so much for your help once again. Thank you, too, Marsh. Good night all. |
| tony | God Bless Joe |
| marsh | Your welcome, Sherri. |
| Joy | THANK YOU JOE! I learned a lot today from you and marsh. |
| tony | Hello....Matt |
| amathevs21 | Sorry my Internet connection was out |
| Joy | Have a great night and sweet dreams!! Your lettuce is growing while you sleep :-) |
| JoeRoss | Joy: They did it on their own and told me about it afterwards. In fact the only way I knew about it was from their forum posts. |
| hellboy | Good night |
| JoeRoss | Good night everyone |
| JoeRoss | See you next week. |
| hellboy | c u |
| amathevs21 | Tony: My CHarts is 1.5300 for EUR/USD now |
| marsh | Good night Joe, and thanks. |
| Joy | Bye Joe! I am glad the forum was broken this weekend - I would have been taken in :-) |
| amathevs21 | Goodnight Joe |
| JoeRoss | I'll be all alone :( Loretta is heading for Kansas City next Wednesday |
| Joy | Poor Joe... we will be thinking of you! |
| tony | Went up to another 3 ticks.... |
| amathevs21 | No you're not alone Joe, Jesus Christ always be with you |
| amathevs21 | GOD Bless you Joe |
| JoeRoss | Thanks amathevs, You are right. I am never alone. |
| JoeRoss | Bye all |
| amathevs21 | AMIN |
Next Chat with
Joe Ross:
Wednesday, May 14, 2008
Time: 8:00 - 9:00 P.M., U.S. Central Time.
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