Commodity Chat With Trader Jim! (tm) with Jim Prince
from June 5, 2007
Return to archives page
Hello and good evening! Trader Jim here. . .
Thanks for joining me tonight. I’m real excited about tonight’s chat. A number of markets have moved fantastically since our last meeting, so we have a lot to chat about.
For example, July Cotton, June Canadian Dollar, July Soybean Oil, June Japanese Yen, and December Eurodollars have all moved very nicely during the last month! Several other markets are in the process of setting up potential opportunities too.
To top it off, all of the markets mentioned have, at one time or another, been featured in our nightly Premium Alert Service™ (PAS) videos!
If you’ve had a successful paper trade or real money trade in any of these markets (or others), I encourage you to feel free to divulge your trade details to fellow Course Members.
Discussing your market experiences lets others know they are not alone in this business. So please feel free to share your excitement, passion, and enthusiasm. It gives others optimism and shows the possibilities of what can be done.
Of course all of this wouldn’t have been possible without Ken Roberts. So I’d like send a big “Thank You” to Ken for all he’s done and for introducing us to the World’s Greatest Business over 20 years ago. I was fortunate enough to not only be a student of Ken's, but I also had the great pleasure to work for him for 12+ years. I’m happy to be able to share with you what I’ve learned over the years.
As we begin this evening’s session, remember the reason these monthly chats are conducted is to provide you the opportunity to ask questions and to pick the brain of a 20+ year student of the markets.
It’s not the best use of our limited time here together for me to define basic terms and
explain introductory principles taught in your Course materials. (That’s what our Course Counselors are here for. They can be reached at 541-955-2885) This chat is the time for you to use me to help you apply the basics you’re learning and to prepare you for what to expect once you’re out in the market itself (either paper trading or with real money). And if we have some fun and laughter along those lines, so much the better.
NOTE!!! When commenting on one of the WGB strategies or US Charts, please identify WHICH STRATEGY AND/OR MARKET. Also, when relating trading experiences and/or results, please provide details: Futures contracts, options, option strike prices, options AND futures, real money or paper trading, etc. This helps others follow along and learn from your experience too.
DAVE FROM OHIO asks:
TRADER JIM AND THE GANG! I HOPE YOUR WEEKEND VACATION WENT WELL. QUESTION: HOW DO YOU TIME YOUR ENTRY UPON ENTERING THE MARKET ON THE PULL BACK/HOOK PATTERN CONCEPT? SOMETIMES THE MARKET PULLS BACK TO THE ORIGINAL LINE OF SUPPORT / RESISTANCE AND NOT BACK WITHIN THE CHART PATTERN FOR AN ENTRY ON THE 2ND BREAKOUT. HOW DOES ONE DECIDE? THANKS DAVE
at 6:09:56 PM
Hi Dave from Ohio! Yes, my "long weekend" was great, thanks! This is an entry concept I've taught on the Premium Alert Service videos. Basically it's all about entering the market on pullbacks to support in an advancing market or to resistance in a declining market. I place my entry order near the support/resistance waiting to see if prices will pullback to that level. If it happens, my order will be filled. It's a difficult concept to explain here without charts so I'll try to do a training video on it this Friday. Hope the short explanation helps some until the video.
hwy510 asks:
Hi Jim, Paper trader here, coming to the weekend course, see you there!
My question, what would be a target price for going long on Sept. wheat. the risk/reward ratio seems not so great to me (a beginner)
at 6:15:25 PM
Hey hwy510! Thanks for joining us tonight. If you look at the weekly chart found in the chart book you'll see that I marked off a couple of resistance areas sometime ago. The upper level would be the short-term target. It's at roughly 557. Your risk is, of course, relative to where you place your initial stop. While this isn't a real "stellar" setup, the opportunity is there. Of course, keep in mind that you can (and should) always trail a stop loss as the market advances. Also if you're trading more than one position you can liquidate one at this target while holding the remaining position to see if it will reach your longer-term target. (See monthly chart.)
aspen asks:
Hello Jim .. my name is Aspen and I am new to this chat what must I do ?
at 6:17:04 PM
Hey aspen! Just sit back and enjoy. Be sure to click refresh to see the most current Q&A's. Thanks for joining us tonight.
Victua from the Garden State asks:
Hi Jim, Victua from the Garden State...the current pause in the July 2007 Lumber chart.....would you consider that a bull flag?...thanks
at 6:21:08 PM
Howdy Victua from the Garden State! I think it's on its way to developing a flag, but at this point, in my opinion, not enough time has elapsed to form the flag. We might even need another five days or more to really get a "good looking" flag. That said, good eye! Keep up the good work!
fortgirl asks:
I used to trade the commodity markets but have been I am currently out-of-touch...it seems much has changed...any suggestions as to how to get back up to speed in the current markets?? I would like to reapproach the markets with intelligence.
at 6:26:02 PM
Hi fortgirl! To learn all about our "new" approach to the markets your best bet is to call one of our Course Counselors. They will fill you in on the details and give you a heads up on the easiest and quickest way to restart. Call them Monday through Friday from 8:30am to 5:00pm PT at 541-955-2885. Welcome back!
Smokin Joe asks:
Hi Jim,
August Live Cattle is in a down trend and has broken below the lower trend line of a pennant formation. The options only have 59 days left on them. Would you trade this market with put options even though they don't have at least 90 days before expiration? What about the October puts, if they break below the flat bottom triangle?
at 6:33:33 PM
Good question Smokin Joe! For me the ideal scenario is 90+ days until expiration. However, that doesn't mean I won't trade with less time available. Many times I'll trade options with less time remaining. If you think, through your analysis, that the market will head lower quicker than a snails pace, then the August options might be okay. If the market hasn't moved within say 30 days then you can always liquidate the options before they start to really depreciate because of losing time value. Otherwise, you might want to go with your analysis of the further out market.
carlt asks:
Trader Jim, Carlt from western NY. Got introduced to commodities with Ken's TWMPMM course back in 1987, and have been trading on and off for the past 10 years. I recently went through the archives of all training videos,chats and premium alerts and have probably learned more from them about trading than all the other material I've studied over the past 10 years. Thanks to you and Ken for all you've done over the years.
at 6:34:53 PM
Wow, very nice of you to say carlt! The pleasure is all ours! Thank for the kind words.
schweetie asks:
Hello Jim, July sugar appears to have closed below the narrow channel it has been in recently. Does this trigger a trading opportunity?
at 6:40:30 PM
Hi schweetie! Yep, July Sugar did indeed trigger a paper trade to the downside for tomorrow. Be aware that Last Trading Day (LTD) is June 29. So you have just a little over three weeks to be in this trade. In fact, you'd really want to be out of a position in this market a week before LTD.
ashere asks:
If I want to buy a call option on a pullback after that commodity reached a new high , do I do then when it pulled back or do I wait for it to again reach the previous high. Asher
at 6:42:21 PM
Hi ashere, If you want to buy on the pull back then that's the way to do it. This allows you to get in at a better or lessor price. If you wait for prices to rally again you'll pay more. Hope this helps.
Correy asks:
Hi Jim, How do feel about the "mini" markets?
at 6:46:04 PM
Hi Correy, Once in awhile I shop at one but for the most part I visit full service stores. Oh, my tech guy Steve O, just informed me you were asking about the futures markets. Okay, well I like many of the mini contracts. My favorite is the Dow Jones mini. There's also the S&P 500 emini, which is probably the heaviest traded market. Anyway, I like them!
Al asks:
Hi Jim, I am a Canuck and in the past have traded the C$ and made
money up and down. I am just returning to trading after a long layoff, What do you see for the C$? thanks Al
at 6:49:10 PM
Well Al, you just missed a MONSTER run up in the Canadian Dollar. We pointed out the 1-2-3 bottom formation in the June contract back in March and it exploded shortly after. It hit all four of our initial targets. Recently it triggered another setup based on the Hi Lo Breakout strategy and that has faired very nicely too. Right now, if you're not already paper trading this market I'd be on the sidelines watching and waiting for the next setup.
traderphil asks:
Hey Trader Jim! Welcome back! I¡¦ve had a lot of success with my trading lately. One thing I can attribute it to is that I started receiving the paper charts provided by United States Chart Company a couple of months ago. These charts are laid out in a way that makes it easy to view several different futures contracts at one time. Recently, this allowed me to identify a Flat Top Triangle in the June Mexican Peso that I would have missed otherwise. One trade and I made back my initial investment in the paper charts four times over. US Charts is bringing it! PS-Watch out for those Cincinnati Reds¡K..they¡¦re getting ready to make a huge run at the pennant. ƒº
at 6:51:58 PM
Hey traderphil! Glad you enjoy the paper charts too. And congrats on your success. As far as the Reds go. . . my Mariners will be laying a beating on them here in a week or so during interleague play. Too bad for the Reds, but good for the M's! ;)
Bama Jack asks:
Hi Jim,You are so right ,we all need time out to recharge.I've been paper trading when trend seaker change to up or down on the first day, it is working very good.Today I paper traded silver and cotton up,will see how it does??Really enjoying PAS!
at 6:53:25 PM
Nice to hear from you Bama Jack! Yep, that's our Strong 1 strategy workin' there. Good job and just remember to always have an exit plan in place too -- for taking both profits or losses. Nice job and thanks for the kind words.
Destin asks:
Jim, what does membership cost here for those who want the premium alert service?
at 6:55:47 PM
Hey Destin, For all the information about the Premium Alert Service be sure to click on the graphic below. Thanks for your interest.
ed asks:
Evening Jim from warm & muggy Texas!
Does this business present the same or better opportunities today than when Ken started some 20+ years ago? Thank you.
at 6:59:31 PM
Absolutely, Ed! The markets always present opportunities. They were here 50 years ago and they will be available 50 years from now. People drive the markets and it's because humans are involved that the markets do what they do. On top of that there's the old supply and demand factor. We trade commodities and the world needs commodities to exist. Corn, Oats, Wheat, Cattle and so on. . . Thanks for joining us this evening.
DC asks:
Hi Jim. I'm a recent addition to the WGB membership. I've seen on a few chats and emails references to "flag" and "pennant" formations. I don't understand what these are. Is this explained in the WGB Guidebook or Strategies section of the website?
at 7:03:50 PM
Welcome, DC! Pennants are featured in our course manual (also called symetrical triangles). I produced a Training Video on both Bull and Bear flags that is available to you for free if you're a US Charts Online subscriber. Login to the site and click on the Training Video tab. Then locate the 12/08/06 video titled Bull and Bear Flag Formations. Also be sure to watch the video I did about Pennants and triangles. It's dated 08/11/06. This should help you tremendously.
blazingbronco asks:
aloha Jim form waianae hawaii; been away wasting my time and money on other charting products. came back to us charts and love th e friendlier site. follow your advice on make a plan trade the plan. up $1000 real money. keep up the good work.
at 7:06:06 PM
Welcome back, balzingbronco! Congrats on your trade and more importantly making a plan and sticking to it. That is the most important thing you and any trader can do.
Sonrise 80/20 asks:
I am holding a July OJ 155 Put that I purchased for about $200. My target is the daily low @ 146. I was excited when we broke through 150 and strong resistance @ 148 yesterday. Trend S is showing Down w/weakest ranking. With only 10 days till expiration will I have difficulty unloading it and therefore get out? Thank you, for all that you do to help us. You are THE BEST!!!
at 7:11:06 PM
You are at CRUNCH time Sonrise 80/20! Your option is slightly in-the-money meaning you have a nice profit. One thing to keep in mind is that if your option expires in-the-money it will automatically be exercised by the exchange. This means you'll take on an actual short futures position and have to post margin money to do so. I don't believe you'd have any trouble getting out. You might want to contact your broker to be sure he/she can work with you so that you get a good exit. I wish you the best.
Binkey asks:
Hi Jim Stella from Canada,I have been paper trading for a year now online & am doing very good,however I am terified to join the real market, How does one get over this. The Canadian dollar is making me a small fortune. Thanks for any help.
at 7:14:31 PM
Hi Binkey, Ken used to say that you'll know when your ready because you'll be tired of making money on paper. I know of no way to help you get over your fear other than by saying do it. But I'm not going to tell you to actually do it. Only you'll know when you're ready. Your fears are perfectly natural -- we all have or have had them at one point or another. Just remember how to eat an elephant. . . one bite at a time. Take it slow and easy. You'll get to where you want to be eventually.
Michele of NC asks:
If Dec corn moves above the top of the channel and TS goes from Dn to up
I see corn making a major move up. Your thoughts?
at 7:17:02 PM
Good analysis Michele of NC, However, I don't know about a major move. Instead I'll follow the market and take what it gives. While a major move might occur, there is no guarantee. That said, I'll attempt to ride it for whatever it wants to send our way.
Bill in NC asks:
Hi Jim...Hope you have a good vacation....Out of curiosity what does the term mean "over bought" and " over sold"? I stick to the charts like a leach. Many, many, thanks for for the Premium Alert and Friday lessons.
at 7:20:42 PM
Howdy Bill in NC. I don't use the terms "over bought" or "over sold" because I think they are misguided. Some traders will use these terms when analyzing a market. For instance, if a market is at all-time highs they might say it's overbought (and vice versa for a market making multi-year lows). But my take is this. . . who's to say what's high or what's low? Folks were saying that about Copper a couple years ago but it powered higher month after month. The Dow Jones is current example. Some traders have been saying it's over bought for the last several months, yet it continues higher. Hope this helps.
Click here to learn all about our brand new
Video Training Series!
ddenney99 asks:
Hi Jim, When are you going to show a "strangle" entry, one that you would enter yourself? If I missed one, since Jan, 2007, please reiterate. Thanks,
at 7:25:31 PM
I'm guessing that you're asking this because you have the Strangle Strategy that I wrote for subscribers to the PAS? I don't plan on featuring that strategy in the emails or videos anytime soon. Not all Course Members have it so it wouldn't be fair to those who do. If you've paper traded it though, please feel free to tell me about your results. I'd love to hear them.
UK_Kev asks:
Hi Jim! On the Dow Industrial monthly, you say the head and shoulders formation projects a move up to 14,000. How did you come up with the 14,000 figure? Many Thanks!
at 7:27:49 PM
Hi UK_Kev! I measured the distance from the tip of the head to the neckline. I then added the difference to the neckline. This projected the target of 14,000. Thanks for your question tonight.
Walt268 asks:
I am currently trading on the FOREX World Market and use a variety of
indicators. Do you use techniques like Fibonocci ratios, MacD and Moving average cross overs in your techniques or do you do more chart patterns and support/resistance techniques ? -- Walt
at 7:32:19 PM
Hi Walt268, I don't use any of those things. The closest I come is using 50% retracements, which is a Fibonacci number. I will also look at 25% and 75% retracements from time-to-time. However, I prefer to use support and resistance levels as found on the Daily, Weekly and Monthly charts. In addition to support/resistance I look for various chart patterns as taught in our Course materials. Thanks for the question Walt.
twindent asks:
Trader Jim, just a big thank you for how well you and your crew have done taking over the trading sessions. I was a bit nervous at first when Ken left but now I see that things running smoother than ever. I'm making money in the markets! Real Money. Doubled my account in April and May. Slow but steady! I LOVE your analogy about hitting singles and doubles to win the game!
PS: I was making money while out of work and taking chemotherapy for cancer too. Almost through with the chemo and doing well and ready for a full recovery!
God Bless,
at 7:36:14 PM
Wow, twindent congrats on doing so well with your trading. But more importantly congrats for doing so very well with your chemotherapy. I wish you the very best and God Bless you too.
ready2win asks:
One more question Jim. In establishing an exit strategy using options and if you decided (as long as the charts support this)to double your value. Should you exit if your option doubles or use it as a stop and if charts again support go to the next level of support? thanks
at 7:38:51 PM
ready2win, I think you actually answered your question with your question. Here's what I mean, if you plan is to exit once the option has doubled in value then you have to do so because it's part of your plan! Of course it's a bummer when you watch a market hit your target and continue on without you. But let me tell you this. . . it's an even bigger bummer if your target is hit and the market reverses on a dime and you don't make a penny! Don't be greedy. Have a plan and stick to it. Doing so will help you tremendously.
Mike in NYC asks:
December Corn has been in a downtrend for 57-days, and is rated Extreme today.
The Weekly chart says the Corn market has been in an uptrend for 38-weeks, and the Monthly chart shows an uptrend for 10-months.
Do you use the Weekly/Monthly trends as a predictor of what trend the Front-month might develop into, or do you just trade the trend and formation on the Daily charts?
at 7:40:52 PM
Hi Mike in NYC, Generally speaking I just trade off of the daily chart and use it's trend rating. I'm a mid to short term trader and that's what I teach. If you're a long-term trader then those rating are something you might consider. That said, the ideal situation would be to have the monthly, weekly, and daily trend ratings all pointing in the same direction.
traderjerry asks:
I found that if trendseeker (daily, weekly, and monthly)is pointing in the same direction of your recommended trades, I have less downside when a trade turns bad and pretty good gains on the upside. Is there a way I can easily track the market with this kind of setup?
at 7:43:16 PM
Congrats on finding what works for you. The best thing I can think of traderjerry, is to simply check the ratings below each of the charts whenever contemplating an entry. Of course I would do that in conjunction to whatever strategy/chart patterns you're using. I hope this helps.
Arlo asks:
Trader Jim
In the introduction you encouraged us to "feel free to divulge your trade details to fellow Course Members."
This is my most recent experience:
I have followed your PAS assessment of the grain market for the last 2-3 weeks and waited impatiently. Following your subtle clues, and denying my impulsive nature, I entered the market with paper trades using the tools on the US Charts website on 06/01/07 with call options on Christmas Oates and July Corn. As of the close of today, 06/05/07, I am $1000+ profit. I have stops, and targets in place according to natural support/resistance based on what I have learned from you and Ken.
This is not the first time I have had a paper trade profit of over $1000 in just a few days using your methods.
You did not tell me what to do. You taught me what to do. The courage to enter the market with real money just got a boost.
Thanks
Arlo
at 7:49:00 PM
Awesome Arlo! Great to hear you're doing so well. And you know what? That's what we at US Charts are all about. Telling you what we're doing on a personal level does absolutely nothing for you or anybody else. We are all different individuals, have different risk tolerances, bank accounts and though processes. Therefore, what good would it do you if I told you I bought 10 contracts of XYZ at such and such a price? I know you and others know the answer. . . it does you NO good. So the way we look at it is education speaks louder than mere words. We show you how we approach the markets but ultimately it's up to you to execute your own plan. Sounds like you've done a fantastic job of doing just this! Keep on keepin' on!
mofa asks:
Jim - Greetings from Singapore - question: does the website still offer the strategies for 123 and Hi & Low? I can not find my copy would like to download new copy
at 7:50:27 PM
Hey mofa, Thanks for joining us tonight. Yes, go to: wgbmembers.com. Once there click on the strategies tab and you can access the strategies.
hwy510 asks:
Jim,
How do you decide which commodities to feature with each Premium Alert?
For instance you didn't mention Live Cattle or Wheat today , but triggers were hit?
at 7:56:03 PM
I simply look through the charts believe it or not. In today's video I featured seven or eight different markets. Actually I featured Wheat twice but felt the other markets that were in the video today just stood out a bit more to me. The key here though is that you are on top of it. You recognized that Cattle triggered and that what it's all about. Nice job.
Susan_in_CA asks:
Thanks for doing these Chats, Jim. Do you recommend the Premium Alert Service for beginners? I've read the manual and I've familiarized myself with the online charts. I'm at a point where I'm ready to start papertrading esp. with ideas I get from the regular weekly alerts. I realize that pace of learning is different for each person but what would you think about someone like me getting the Premium Alerts at this point? Thanks!
at 8:07:54 PM
Hi Susan_in_CA. I'm not going to recommend that you subscribe to the PAS. Rather you should determine it for yourself. You can try it for two-weeks for just $4.97. Keep in mind that it is not an advisory service. It's an educational service that points out chart patterns and support/resistance levels etc. as well as different approaches to paper trading. Approaches you can easily learn. If you find that after two weeks you're not ready quite yet, then no harm. You're right, we all move and learn at a different pace. Thanks!
larry from Florida asks:
hi Jim just wanted to thank you for the fine job you are doing. My question to you is... will there be another "conversations with course members"? I love to hear/read about the great trades others are making. For exzmple I had an awesome lumber paper trade. bought two for 8.7 pts. and liqudated at 31.9
at 8:10:13 PM
Thanks larry from Florida! Eventually we plan to have a similar feature to Conversations with Course Members available on our web site. But for now we're still working on it. Great paper trade in lumber! Keep it up!
Aspen asks:
ASPEN FROM OTTAWA
Thanks Jim enjoyed my 1st chat and looking forward for more chats and successful trading sessions..
at 8:11:43 PM
Thanks for joining us tonight, Aspen!
Well that's it for this month. Keep in mind, that you're not alone in your trading
journey. US Charts Online, myself, and our wonderful Course Counselors (541-955-2885)
are here to help you become the best you can be. On that note, be sure to check out
our weekly video trading lessons at: US Charts Online. This is a fantastic teaching tool and free to
all WGB Members and Online Chart subscribers!
Finally, make sure you have a plan prior to entering any trade and use stops to
protect your trading capital. As a trader your capital is THE most valuable asset you
have!
Plan your trade and trade your plan!
My next chat will be on Tuesday, July 10, 2007. God Bless and I look forward to seeing
you then!
Return to archives page