Ken Roberts Chat


We covered the spectrum at last Tuesday's Let's Talk Trading Chat --- everything from fundamental vs. technical analysis, the 50% Retracement Rule, and where to eat when in Chicago, to the difference between men and women traders! Scour the entire dialog between Course Members and me, and pay particular attention to: "Stephen362"'s summation of fundamental trading at 6:58. It's classic . . . ! I've said it for years now, but no one believes me until it happens to him or her. Well, it just happened to TOVIJUNKIE at 7:25 and "Drew in Atlanta" at 7:37. "dallasnag" and her husband should read "The Differences Between a Man and a Woman" in the Trader Library. That's why I posted these words of wisdom!! 7:27 I realized that a lot of Course Members don't know about (and therefore aren't benefiting from) the many resources I offer through all our websites. So in this month's Archives, I've embedded links to many "gold nuggets" you may not be aware of. So I'll let you go find that gold!
Until Next Time,
Keep Scrolling!

NOTE: If you no longer wish to be notified of our chats, please go to chat.kenroberts.net, scroll down the page, enter your e-mail address in the box provided, and then click the "Remove" button located below the box. If you would like to report a change in your e-mail address and continue receiving notification of our chats, simply delete your old address as outlined above, and then enter your new address.

Let's Talk Trading (tm) with Ken Roberts
from June 14, 2005

Return to archives page

As we begin this evenings session, let me state the reason I conduct these monthly chats: to provide you the opportunity to ask questions and pick the brain of a successful, long-time, real-money trader. Its not the highest and best use of our limited time here together for me to define basic terms and explain introductory principles taught in your Course materials. Thats what my Course Counselors are here for... Now is the time for you to use me to help you apply the basics youre learning and to prepare you for what to expect once youre out in the market itself (either paper trading or with real money). And if we have some fun along those lines, so much better. Alright... Ive got a Cuban Cohiba Robusto fired up, heres our platter of Krista's freshly baked oatmeal raisin cookies, the (Cafe Altura coffees poured, so lets talk commodities! NOTE!!! When commenting on one of my Courses, please identify WHICH ONE. Also, when relating trading experiences and/or results, please give details: Futures contracts, options, options AND futures, etc. This helps others follow along and learn from your experience too.

Arlene M asks:
How do I get motivated to start my trading sessions and making some money.

at 6:12:16 PM
Hello Arlene. Ultimately, no one can make any of us do anything. This means that we all can only be SELF-motivated. (Everyone's doing what they would rather do than not do! Seeing this gives you an entirely new outlook on the world --- everyone's doing his or her best!) This is why I stay in touch with you, follow through with my trading updates, and (especially) provide you with a highly trained team of incredible Course Counselors to call upon whenever you need! Keep us posted!

Since we're speaking of Course Counselors, they asked me to remind you this evening that we have ONE open seat for my June 25th Trading Camp here in Grants Pass. If you're interested, please call a Course Counselor tomorrow at 541-955-2700 (at 9:am Pacific Time).

KenRoberts.com Members' Library

rhf1796 asks:
Redding, CA, USA A BETTER WAY TO MAKE MONEY by Burton Pugh. What a fascinating book! I am so full of questions now that I hardly know where to begin. But heres a couple: Would it be correct to say that for almost 4 years (1998 to 2002) Mr. Pughs advice to be patient with wheat would have been terribly difficult to follow? Do you see opportunities today for profiting using his Triple Zone System for example, are the ups and downs we see in the December 05 contract worthy of the System or are they too small? By his definition, are they bull and bear markets? If so, US Charts interactive program is perfect for applying the center line and the upper and lower lines to form the Normal Zone. I used it to lay out the lines for the bull and bear that started 5/13/05 and topped 5/26. Its not done yet because it needs to drop below 333 to get into the Sub-normal zone, but if it truly is a bull and bear cycle, Pugh would maintain that IT WILL DROP and we should be gettin

at 6:21:14 PM
That's a mighty full question, rhf1796 . . . . I can tell that you get it! Yes, it can take years for a market to travel from bottom to top (and back again), but remember that there are LOTS of smaller moves making up those HUGE moves. Now you know why U.S. Charts "handles" this kind of charting! (TOVI's Long-Term Market Ratings and, in particular, its VALUE BANDS (which are an evolution of Pugh's research and findings. This all may seem a bit overwhelming right now, but stick with it. As Einstein said "Do something for 15 minutes a day and within a year you'll be an expert."

A Stellar Find

Dick in Oshkosh asks:
Hello Ken and staff: Recently traded lean hogs and made 1200 profit while I was on vacation! I am currently short orange juice, what do you think of that market as the 50% level is at 78 cents? Thanks.

at 6:22:59 PM
That's what it looks like to me too, Dick! Go O.J. go!

Another Star Discovered

Mickeyite asks:
Hi Ken. Mickeyite in Salem asking: I am officially open for business. My account is with Refco, and they are very helpful and understanding. I want to mention, that when I first called to purchase "Christmas bean oil" call options, my broker gave me a bid and offer price. I wasnt expecting this, and was immediately exposed as an amateur. I even asked for "bean oil" and not "soybean oil". Can you go over "bid" and "offer" for those who have yet to make that first trade?

at 6:29:32 PM
Congratulations, Mickeyite! That's okay: You're not out to impress anyone --- all you want is to run YOUR business the best you can. Commodities bought and sold in commodity exchanges are done so via a "bid and ask" system. The seller "asks" a certain price, and a buyer "bids" a different price. And then suddenly the two meet and a trade takes place. So when your broker gave you the current bid and ask prices, in essence he was telling you that there wasn't a recent trade, but that there was a "standoff" between buyers and sellers at the two prices he quoted you. Always feel free to discuss anything that's not clear to you with your broker. That's what "full service" means, and that's what you're paying for. Good going!

CHARTECH asks:
Ken have you got the 50% retracement video done yet.

at 6:32:01 PM
Funny, Chartech, our "Editing Department" (Steve!) is here right now, and he says it's 50% done . . . . Thanks for asking (it'll be WELL worth the wait)!

desertbum asks:
Ken, there are a lot of markets that you don't have charts for in Chart book. Are you trading these other markets?

at 6:34:27 PM
Oh yes, desertbum, there are scores more markets than those we trade!!! (Do some research: eggs, lead, chickens, rubber, milk, etc., etc. --- just about any commodity.) I stick with Ken's Chart Book --- that's enough for me!

Joeinphx asks:
Hi Ken, great to be here. Thanks for doing these chats. When you give us information on your trades and you say "before fees and commissions," how come you don't give us some idea of actual costs? Thanks

at 6:37:43 PM
Because they vary so much, Joeinphx. Fees can vary from Exchange to Exchange and commissions vary according to full-service, discount brokerage, online brokerage, your particular volume of trading, etc., etc. Good question. Hope this helps.

Joeinphx asks:
Hi Ken. are you going to re-publish Ted Warrens book?

at 6:38:09 PM
Earth to Joeinphx: Go to www.fourstarbooks.com !!!

darek asks:
Darek/Dallas On Ken's Chart Book you make notations about the commodity, then we look up the trend in Trovi. How far ahead do you choose the option month?

at 6:41:03 PM
If you're trading options, darek, at least 90 days out. If futures, at LEAST the Active Futures Month (you'll find the AFM on the TOVI Trend Tracker at USCharts.

salvomix asks:
Cohiba Robusto, that is stout!

at 6:42:56 PM
Yes it is, salvomix!

Gary asks:
Ken, I'm a 2 week old apprentice but I have put over 50 hours into studying your teaching which is an A+. Since you haven't sent my report card, I don't know what my grades are. 3 paper trades so far are all in the right direction. I'm confident and anxious to get started for real! What do you suggest in my situation?

at 6:45:18 PM
A+++ Gary! Go to the head of the class! Now, do you find yourself saying "I'm tired of being right and not making any money on it" a LOT? (With only 3 trades under your belt, probably not, but let us know when you are!)

mfishbon asks:
Hi Ken..I spent the day with Jim yesterday and he was great!Lots of valuable info..It was worth the trip..and thanks for signing the book.

at 6:46:41 PM
Thanks Mark --- you're welcome! (Funny, we were just talking about seizures when your question came in . . . .)

troll35 asks:
first time on the board and I want to let you know what I did this weekend. I got on my motorcycle and drove for 7 hours from Stockton, Ca all the way to Grants Pass Sunday night. I stayed at the Travelodge on Vine street and first thing Monday morning I went to take your tour of the Ken Roberts Company. I was highly impressed with the friendliness of the people. I was hoping to meet you in person but then again, you are a busy guy. I drove home today. 904 miles round trip. I have taken the Twmpmm 1 a couple of years ago and then I took it again. i have read a few of your books and now I am enrolled on this. My trip up there was for motivation and now I am really ready to go. Thanks for helping out.

at 6:49:38 PM
Thanks troll35! Glad you made the trip (you picked some beautiful weather . . .), and I'm glad it was productive for you. Glad you're online here with us tonight too. Stay the Course --- and stay in touch!

Dave asks:
Dave - Muscatine,IA I purchased Jim Roger's Hot Commodities from Patti when I visited with her at your shop May 23rd. He has little confidence in technical trading, feels that fundamentals are the only way to go. This puts him at odds with you, but you encourage people to read his book. Isn't perhaps a middle ground the best approach? Understanding the fundamentals may stop one from reacting to false signals and your technical analysis alerts us to possible moves.

at 6:56:35 PM
(See the Chat Archives of March 8, 2005: My response to "Michael" at 6:29pm . . . .) Read those stats and then tell me what you think. I don't know how Jim Rogers "ignores" these facts, but he does. He's still a great trader, however, and ran one of the most successful commodity funds of all time with George Soros. But interestingly, George Soros recently said in an interview how he and Jim Rogers fundamentally DISagree!!! (See Chat Archives of April 12, 2005. "Ruder" at 7:33pm . . . .) Bottom line, Dave, is that yes, fundamentals absolutely DO move the markets. But there is NO WAY any of us can know ALL the fundamentals that make a difference!!! But price charts can and do!!! (Read the new Burton Pugh book that's newly available at Four Star Books for his take on all this too. It's an eye-opener! Thanks . . . .

Stephen362 asks:
Ken: This is truly the worlds greatest business. I am up $1400.00 in Nov beans with a 720 call option. I paid 18 points and today it is going for 45 points. Now for all those funny mental traders. June 1 was the begining of hurricane season. If a hurricane heads for the gulf get long oil cause the oil rigs can get damaged. If it heads for New Orleans get long coffee. The coffee warehouses in New Orleans could get flooded. If the hurricane heads to Florida get long OJ. Who knows how many orchards will be wiped out. What is so sad is that there are individuals who trade this way. Thank goodness for US Charts and your online charts. No guessing at fundamentals. The charts tell all.

at 6:58:26 PM
I couldn't have said (or timed!) this better, Stephen362!!! (Hey Dave . . . this one's for you too!)

Marty asks:
Hello, I've been paper trading for on & off for year and doing alright at futures, but options not so well, still learning I guess. I keep reading here and there people losing big and hearing local residents say that so & so lost 40,ooo and so & so lost $$$$$, Ive neaver talked to these people myself but after taking your course and using stops and watching daily limits (all paper trading) how do people lose so much? I've contacted brokers and they seem confident in using stops and exitecuting your moves for you with out a phone call to them. I'm I missing something? Trade tracker is great, I could use a notes area in custom quotes just like trade tracker, the whole site is very user friendly. Marty

at 7:01:00 PM
Thanks Marty! No, don't go second-guessing yourself because those who do NOTHING disagree! (Do you realize that the world does NOT want you to be successful?!) Carry on . . . ! (I've noted your "notes area" suggestion for our programmers . . . .)

andre asks:
Dear Ken and staff I am 16 and I am in the mini corn market for call can you tell me in what derection you see the contract headed Thx. Andre

at 7:02:39 PM
Check your charts, andre: That gap in prices may get filled to the downside, but I see Corn as "UP" after that. But more importantly, what do YOU think??? Welcome aboard, andre! Stay in touch . . . .

alan asks:
Hi Ken! A few years ago(while still working) I signed up for your initial course but never followed through on it. Now that I am retired (but not much income) and have the time; where do I start? Thanks!

at 7:04:36 PM
Go to "Member Login" and click on "Get Going®!" . . . . That'll get you going! Welcome back alan!

Jim from Kalamazoo, MI asks:
I haven't traded in awhile and I feel overwhelmed. Are there specific steps I should do? In what order should I do them?

at 7:05:35 PM
Hi Jim, please see my response to Alan (the question before yours). Also realize that my Course Counselors are here for YOU every trading day! Welcome aboard!

ksweetman asks:
Bend, Oregon. Is there such a thing as going short on options?

at 7:06:17 PM
Yes, ksweetman. That would be WRITING the option (instead of buying the option as we do in the WGB Course).

Antony asks:
Helly Ken. Thank you for sending me your booklet a few weeks ago. I don't know how you found me, but thank you. Within a weeks time I've alrady started paper trading. My question is Out of the 3 strategies you use, which one is the most successful one statistically? I personally don't find the Strong1 method very assuring since it soley depends on TOVI. I'd like to hear your thoughts on this. Thank you.

at 7:12:55 PM
Hello Antony. I like, use, and trade ALL 3 strategies, but I have to admit that I tend to favor the Hi-Lo Breakout Strategy.

Ensenada Tom asks:
Hello from sunny Ensenada Ken. Over the years, I have studdied commodities with you (with TWMPMM and TWGB)I have found the mental parts of trading far more difficult (and at least as interesting) to understand as the technical aspects of trading. What resource do you recommend now that I seriously want to address the mental aspects of trading?

at 7:17:35 PM
Great insights, Ensenada Tom! I've been saying this year after year after year, but no one listens! This, in fact, is why I foundedFour Star Books!!! You're a man after my own heart, Tom --- bless you!!! (Sir John Templeton, the legendary trader, said in Forbes Magazine, "The more you study spirituality, the better investor you will be . . ."!!!) ANY book at Four Star will help you. And let me get a plug in here for my Ultimate Technique for Success Course. It's awesome! You'd love our new monthly online RoundTable Meetings and my brand new monthly Gold COIN tasks!

karen asks:
Your cost of the options you buy are usually over 1,000 dollars most of the time. I would like to see cheaper ones, I realize that I wouldn't make as much money.

at 7:19:02 PM
You might, karen! Try a strategy of your own (on paper) and see what happens. This is what I call a "contrarian" strategy and I LOVE hearing Course Members' contrarian strategies. Stay in touch! Thanks.

sdul32151 asks:
Is it possible to enter a position by buying an option and not be able to sell to exit a position to cut a loss or take a profit?

at 7:22:02 PM
I suppose it's possible, sdul32151, but it's never happened to me or anyone I know.

hgs asks:
hgs- the price of corn and beans at this time of year is often heat/moisture related, I watch CNN but is there a better public service?

at 7:22:27 PM
Yes, hgs, it's called PRICE CHARTS!

guy asks:
ken when starting to trade what commidity do you think someone should trade

at 7:22:44 PM
Paper trade them all, guy!

TOVIJUNKIE asks:
Hi Ken and crew,Wanted to share a trade experience tonight.After paper trading for over two yrs.& trading w/real $ since 9/04 I felt "ready" to trade a contract. Entered long Oct cotton on the pull back from 3 day rally above the 50% and Tovi agreed. Within less than 30 days things progressed nicely and I was up 950. Believing the trend had a ways to go I stayed in. I did not move up my stop to protect profits because I did not want to get stopped out too soon!! Then one day(while at my day job,away from my computer!)the market opened well below my stop and I lost it all plus most of my tiny account. Lesson learned TAKE THE PROFIT. TOVIJUNKIE

at 7:25:24 PM
Great lesson, TOVIJUNKIE! (I've also been saying this for years and years: Perhaps the most difficult part of trading is TAKING PROFITS!!! And now YOU know what I'm talking about.) So think of it this way: What you "lost" may be just a tiny price you had to pay for what that lesson will allow you to gain in the future . . . .

dallasnag asks:
This may not be your area of expertise, but what do you suggest when my trading partner (my huband) and I share a brokerage account, but we both have different trading strategies. I follow the WGB guidelines, while my husband trades by "feel. Needless to say this hasn't worked out and our brokerage account balance dwindled over time. I want to replenish the account and begin trading again, but don't want my husband to trade the WGB way.

at 7:27:36 PM
I've always said at seminars that women seem to do MUCH better at my Course because they FOLLOW MY DIRECTIONS, while men "fly by the seat of their pants" . . . . It might be time to open a separate (secret?) account . . . !

treepartner asks:
Hi, Ken, Krista and all! Has been a while since we've spoken together. Hope all is well and look forward to seeing you again.

at 7:28:58 PM
Hello David!!! How's the Deep South? Let's meet in New Orleans soon --- all that great humidity, and all that great food . . . !

Clancy from Wylie Texas asks:
Hi Ken. I think your best business decision ever was to allow your students to pay for US Charts and TOVI on a month to month basis. I like the improvements to US CHARTS. I've been using the Trade Tracker to paper trade like crazy by trying all sorts of strategies. Will you ever provide delayed chart updates so that we can see the Open High Low during a trading session before the market closes? Commodities IS the World's Perfect Business.

at 7:31:47 PM
Hello Clancy! Good goin'! What you're asking for is already there on USCharts: "Quote Tracker" on USCharts are updated every 20 minutes or so. Stay in touch!

CashMonster asks:
Hi Ken, I have been trading real money in options since February. I think that I am doing okay right now. I purchase single contracts at a time for which I would make a profit. Could you provide some insight on how I can trade option contracts to build my account faster and more efficiently. Example is it better to buy a few contracts of one option vs. 1 contract of several different options.

at 7:33:19 PM
If you put this question to 100 traders, CashMonster, you'll get 100 different answers! What you're asking regards trading STYLE, and that's strictly individual. Paper trade several strategies and find out what's right for YOU.

salvomix asks:
Hey Ken! Love cigars too. Smoke them while I work. I have been paper trading for almost 7 months and have become sick of being right and not making money. Finally funded my account today by selling a few things on eBay. Looking for my first "real trade" opportunity. Thanks for your guidance!

at 7:34:15 PM
(Where do you work, salvomix? Can't be anywhere in America now!!!)

LeeS asks:
Hi Ken, I have my Camel lit, My Vintage Franzia Burgandy poured and my oreos close by, so heres to ya. I am with rhf1796 on the Pugh book. Having done some working with stocks, it appears to me times have changes in the stock market since 1937. However I can see a glimmer of potential today in commodities and I am tempted to experiment some, but you have made it so simple, I kind of hate to waste my time. What do you say?

at 7:35:41 PM
(Sounds like you're in heaven, LeeS . . . !) YES! Experiment with it. Price activity will NEVER become outdated . . . .

Drew in Atlanta asks:
Anyone out there had the experience of feeling like they got out of a market too soon? I liquidated my Dec 88 call in the US Dollar index for $1,100 net profit a couple weeks ago, but the market continued to climb and though I'm grateful for the profit, I wish I'd remained in the market. I saw the market pass the daily 50% retracement point and decided to take profits. At the same time I entered the US Dollar Index market, I also entered the Swiss Franc market with a Dec 80 put and I'm still in this market - I paid .80 pts and the market closed today at 257 pts. But I keep thinking of had I stayed in the US Dollar Index... How do you and/or my fellow traders deal with getting out the market too soon?

at 7:37:49 PM
You did JUST RIGHT, Drew in Atlanta, but maybe this will help: You'll NEVER squeeze every drop out of any market! And here's my other saying "You can't lose money taking profits . . . !" Hope these help . . . .

Ontariotim asks:
Hi Ken and friends, Thanks for getting me started. I haven't done so well but am always trying to learn. I have had a couple good ones, so I know it works. How do you decide whether to trade an option or futures?

at 7:38:46 PM
Thanks Ontariotim! Paper trade BOTH futures and options and see which you prefer. (Believe me: You WILL favor one over the other . . . .) Welcome aboard.

Lea asks:
Ken, when you purchase an option (say for Oct. sugar) which chart do you watch to see if your option hits and if there is any profit or loss? As you can tell I am very new to this.

at 7:40:19 PM
You'll watch the Active Futures Month daily chart to see what that market is doing, but you'll have to get a price quote on your option(s) to learn if it's profiting or not. In other words, the option's price doesn't necessarily directly correspond to the price chart.

BJ Snow asks:
Hi Ken, July Wheat has a contract low at 302 1/4 on Feb 4,2005. It then came really close to that on May 13 at 302 1/2. Would this be close enough to start a new 1-2-3 bottom formation? It looks like that is what is forming currently but your charts just show that it is in a channel.

at 7:42:35 PM
No, it would NOT qualify as a new #1 point (which is an exact number --- the old low), BUT I can see applying a Hi-Lo Breakout Strategy to this one . . . .

scotty asks:
Ken how do you factor in the dry weather in the midwest,or Soybean Rust as it moves North?

at 7:42:59 PM
I DON'T!!!! (But price charts do . . . .)

St. Louis Snag asks:
St. Louis snag. Been paper trading for 6 weeks. Had my ups and downs but learning a ton. I am up about $700.00 to date. US charts online is a wonderful tool. Thanks for being the inspiration. GO CARDINALS!!

at 7:45:06 PM
(So are you a baseball fan, or Catholic, St. Louis Snag?) Glad you're online with us this evening, and welcome aboard! Please keep us posted!

Fix and Fly Paul asks:
Hello Ken and crew: I'm here with my mixed nuts and a Coors Light. Any progress on the option writing module yet? Enjoy the chats!

at 7:50:10 PM
Hi Fix and Fly Paul!!! Hmmmmmm: Mixed nuts and a Coors Light . . . . I don't think I'd recommend lighting up a cigar at the moment (unless you're on the patio)! Yes! The TOVI Option Writing Module (called VSI) will launch mid-July.

CHARTECH asks:
Ken ,I was just looking today at what great work and the tools of the trade you and your staff have provided to all of us and contiune to be there when we have needed help. I know there are alot of great things yet to come.I know if we dont take advantage of all these great teachers, course conselors, and tools we have greatly cheated no one but ourselves. For this I thank you and your staff for all you do. Hope to see you this year planning on two trips one to grants pass and another to cbot. Hey what a friend that donald is wanting to give you all his golden treasure.

at 7:53:10 PM
Thanks CHARTECH!!! I needed that!!!! Yes, you'll love both Grants Pass and the CBOT (and make sure you dine at Gibson's Steak House while in Chicago). Glad you mentioned Scrooge McDuck! Reminder to everyone to submit your entry in this month's Chat Photo Caption Contest at www.kenroberts.com (under Ken's Chat). We're getting some of the best ever . . . !

BIG I asks:
HOW DO YOU KEEP TRACT OF DAY TO DAY PRICES? DO I NEED TO SUBSCRIBE TO THE WALL STREET JOURNAL OR SOME OTHER FINANCIAL PUBLICATION?

at 7:56:39 PM
No! You don't need a subscription to obtain price quotes. I simply call my broker ONCE each day (in the morning) for price updates --- really!!! Try it. (Or simply go to www.uschartco.com whenever you wish an update . . . .)

Desi asks:
Are paper charts available for purchase or can we print the online charts?

at 7:57:39 PM
Yes and yes, Desi! Either way you want!

Mr. Ed (not the horse, of course) asks:
Hi Gang. I've read in some articles on commodities that you should also use 33% and 66% retracement points as support/resistance or entry/exit points, etc. Do you have an opinion or experience using retracements other than 50%?

at 7:59:22 PM
Welcome Mr. Ed! You can find every percentage out there, Mr. Ed, but I've used 50% all these years. (Wait'll you see the new (old) book I just found and will be offering at Four Star Books. Watch your email inbox!

Perry Nelson asks:
Perry Hi Ken, I have taken most of your courses quite a few years ago, but unfortunately strayed into the stock market. I am getting to the point where retirement would be nice if I could aford it. The commodity markets seem like a better place to make money than the stock market -- if one has limited capital. What do you think?

at 7:59:57 PM
See Jim Rogers' book Hot Commodities! for a detailed analysis!!!

Well that's it for another month. Check out my favorite web sites: www.tovionline.com (Have you taken my personal tour yet?); www.uschartco.com ; www.fourstarbooks.com ; www.historictrees.org ; www.billoreilly.com ; www.wildlifeimages.org ; www.salestax.org (Let's abolish the IRS!); www.LP.org (Take The World's Smallest Political Quiz and see where you stand!); www.VOTE.com (Make your voice heard!). My next chat will be Tuesday, July 12th. As always: Use these newfound powers only for Good. Good night, God bless, and whatever you do, never mix nuts and beer (unless you're alone or on the patio)!

Return to archives page

Now's the time to make calls and send emails! Support the two FairTax bills in Congress now that will abolish the IRS, eliminate inheritance taxes, and flush out the underground economy!!! (And what a gift to leave our children and grandchildren!)

Surefit Slip Cover Coupon