Thanks for joining us this evening. I’m very excited about tonight’s chat. There’s been a lot of activity in the markets since we last met and I look forward to reading your comments.
I encourage you to share your excitement as well as any challenges you might be having. Trading can be lonely, but there’s no need for you to feel that way. Sharing your trading stories can go a long way towards helping others!
Thanks to Ken Roberts you have the opportunity to share your ups and downs with other Course Members via this venue.
Speaking of Ken, I’d like send a great big "Thank You" his way. Ken started introducing folks to the World’s Greatest Business roughly 20 years ago. Fortunately I’m not only a student of Ken's, but I also had the good fortune to work for him for 12+ years. I feel blessed to be able to share with you what I’ve learned from my time with Ken.
Make sure to sneak a peek at Ken's Ultimate Technique for Success Course too. Find out more information by clicking here.
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 and active trader.
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
ONE. Also, when relating trading experiences and/or results, please provide details: Futures
contracts, options, options AND futures, etc. This helps others follow along and learn from
your experience too.
Dave C, Natick asks:
Hi Jim & Gang,
I just wanted you to know how much I appreciate your weekly video lessons on US Charts. At the very least, they confirm our approaches, but also show us timely techniques for evaluating markets and conserving our trading capital. Great stuff! Thanks! at 6:07:51 PM
Thanks, Dave C, Natick! I'm glad you enjoy the videos and all the team here is doing for you. Wait til you see what we have coming down the line. . .Manuela asks:
I am confused about which month to check for Options trading. Is it always the front month chart, which give me a hint and then I'll try and find an option further out. Do I then have to check that month chart as well? at 6:10:13 PM
Hey Manuela! Yep, I watch the front month chart and make our decisions from there. Then I look for options that have at least 90-days before expiration. If I must look at options from a different month, I'll look at that chart too just to see if it's made a similar formation.Sam asks:
Could you give me a very basic description of how to use the 1-2-3 strategy? at 6:12:32 PM
Howdy Sam! Sure, we wait for a 1-2-3 formation to take shape. Then wait for Trend Seeker(tm) to confirm that the trend has changed. Once it confirms the trend change we then wait for prices to break the #2 point. If these criteria line up, we then shop for options that we can afford. For a detailed explanation be sure to check out the 1-2-3 Strategy located in the Members area at www.wgbmembers.com .Mike in NYC asks:
Have you considered using breaks of multi-week Uptrend and Downtrend lines as additional confirmation of short-term trend changes? I have been paper trading this with Dec. Wheat this Summer/Fall with good results. It is proving to be another way to make some "Singles" in an up/down market, like what Wheat has been gyrating through. at 6:14:14 PM
Thanks for joining us tonight, Mike! I haven't tried that particular strategy -- but I'd sure be interested (as I'm sure everyone would) in your paper trading results. Please feel free to let us know at one of the next couple of chats. Thanks!Mr.Ed asks:
Ed in Windsor, Ontario
Hi Jim and all, The WGB gives us short term trends with TSR. Will there be a means of giving us the long term trend from the WGB such as TOVI provides, or is it up to us to determine it from the charts? I try to do this, but I don't always agree with what TOVI says. at 6:18:35 PM
Hey Mr. Ed! Of course, of course. . . Trend Seekers Trend Rating does just that. It is an identifyer of the long-term trend. Check out Trend Seeker and focus on the Trend Ranking and you'll see there are many markets with trends 20, 30, even 60 days in length. Hope this helps!
Dave C, Natick asks:
The markets have been SO unstable lately. Trend Seeker regularly reports reversals, and I have temporarily cut back my use of the Strong 1 strategy. I got caught Big Time in Energies last month, but thanks to your reinforcement of reason at our last chat, I was able to get out with at least part of my shirt! LOL. at 6:23:35 PM
Hey Dave! Boy Trend Seeker agreed with the 1-2-3 top in Crude Oil. Did you miss that paper trade? Oh well, sounds like you cut your losses and that's most important. I hope others will follow suit. It's actually the toughest thing for traders to do -- have a plan and take a loss when the trade goes against them.George Michael asks:
Was curious as to what variables Trend Seeker crunches to come up with its trend information? I.E. volume, open interest, etc. at 6:25:55 PM
George, you wouldn't happen to be the singer would you? Anyway, there are a lot of variables for sure. We spend many hours each and every day wearing out pencils and erasers doing calculations. Some day we'll do our 'cipherin' with puters!Manuela asks:
How is the best way to learn paper trading, with the course counsellors or with a broker? at 6:27:38 PM
I'd call a Course Counselor to get assistance. There's no pressure and you can learn at your own speed. Ken always said. . . "nobody cares about your money like you do." So take it slow.Far North asks:
Far North- Tumbler Ridge BC Canada
Hi Jim, was in the markets 10 yrs ago and made the mistake of listening to my broker!!!.I do not have a question at this time but would like to say hello and I am looking forward to chatting at a later time
Thanks to WGB for keeping the dream alive at 6:29:27 PM
Glad you've joined us this evening, Far North! Be sure to take advantage of all we offer -- the free weekly videos, weekly emails, Ken's Chart Book, the It Just Happened emails, and of course our wonderful Course Counselors. We do all we can to help keep the dream alive!DeeBeeTexas asks:
Greetings Prince Jim, Would you suggest a few markets for me as a newbie to start with? at 6:32:30 PM
Howdy DeeBeeTexas! First off, watch last week's free video at US Charts Online. I talked about this exact subject. Secondly, pick a couple markets out of the weekly Friday email. Or Third, pick a few markets out of Ken's Chart Book and follow along. Be sure to read the text on those charts. It will help you stay on the right page so to speak. Last but not least, if you still need assistance I encourage you to call a Course Counselor. They can be reached at: 541-955-2885 Monday through Friday 8:30am - 5:00pm PT.WGM asks:
I just want to say thank you for the weekly trading videos. I especially appreciated the one about being a trader or a gambler. I had just lost $2,000 in the weeks proceding and I was gambling. Thanks for the advice, and I've made that money back in oil since the 6th of September. at 6:35:32 PM
Great comment, WGM. . . so many folks gamble with their investment money and yet work so hard to get that money to begin with. I'm glad you took the video message to heart. Hopefully others reading this message will grasp the importance too. Don't gamble with your trading money! Use good olé fashion common sense and protect your trading capital!Josepig asks:
Hi Jim,
Going back to Manuela's question... If you buy the different month, do you
then follow that month or the front month? at 6:37:06 PM
Hi Josepig, This is a bit tricky, but I'd stay on top of the trade by actually monitoring both months. That said, my main focus would be on the month I'm actually trading.Check out what Ken's up to these days. . .
ronald asks:
JIM, I'VE NEVER HEARD YOU DISCUSS THE 50% RETRACEMENT RULE IN YOUR TRADING PRACTICES... ANY COMMENTS ON THAT SUBJECT TONIGHT? THANKS. at 6:41:58 PM
Hey ronald! The 50% rule is very powerful. I'll mention it from time-to-time when posting charts in Ken's Chart Book and I've done weekly videos on it too. I use 50% levels for targets and at times for entry. That said, have you seen Ken's DVD "The 50% Retracement Rule?" It's great and covers this subject in great detail.Dave C, Natick asks:
Jim,
I have been a US Chart & TOVI subscriber for a couple of years, and continue to do so. I don't need to renew my subscription, as payments are automatically deducted each month. What need I do to get a copy of Ken's new DVD? at 6:44:41 PM
Ken's new DVD is about his favorite market -- right now! If you want to find out what it is and the eight different methods to trade it, then you might want to invest in a copy. Not only is it entertaining but it's educational too. Of course it's up to you to decide if you need it.Williestyle7 asks:
How do I get back in the swing of things? I haven't been around in a while. at 6:47:29 PM
Howdy Williestyle7! Call a Course Counselor tomorrow morning at: 541-955-2885 and they'll point you in the right direction. There's no pressure. They are actually here to help you. So tell them where you're at in your education and they'll point you in the right direction.DeeBeeTexas asks:
Thanks. Are you weekly free videos archived so I can "catch up"? at 6:49:34 PM
Hi DeeBeeTexas! The videos will be archived on our new web site. This will be a great feature because you can access them at anytime and watch 'em at your leisure.mrbaxtor asks:
Hi Trader Jim. I have a good question regarding when to liquidate an in the money option where the market is continuing to trend in my favor. How long should I wait before expiration date to sell (liquidate)? 30 days, 2 weeks, right up to the last day? at 6:54:51 PM
Hi mrbaxtor. . . that's a great question and, unfortunately, is one that can only be answered by you. As long as the market moves in your favor the option could increase in value. If the option is in-the-money at expiration it will be automatically exercised by the exchange. So unless you want your option to turn into a futures contract you'll want to exit before expiration. This is a tough call, if you have such a position you will probably want to chat with your broker about it. He/she can provide some insight to liquidity.Eric in Fort Worth asks:
Good evening, Jim. Back in the mid 90's Ken's primary trading strategy seemed to be to focus on low markets, buying contracts without a stop loss and averaging down (rather than getting out) during market drops. Do you still employ or favor this strategy? Thanks. at 6:57:44 PM
Hi Eric in Fort Worth! You are right, Ken would do that in his long range trading. But a few years ago Ken put together the World's Greatest Business Manual. That's when philosophies changed. Now we go with the trend. We trade with the trend instead of fighting it. Remember, the trend is your friend until it ends!rick asks:
Hi Jim, when placing stop loss orders, do you use previous support/resistance? Or is there another "golden rule"? I seem to set them too close and lose paper money, before the market goes my way. at 7:00:45 PM
Rick we generally use prior support/resistance levels. Keep in mind that these levels are all over the charts. If you find your choice of stop placement is a bit too close consider using different levels. I know that might seem obvious but it's really all you can do. However, remember this. . . if you get stopped out of a trade you can always get back in. Watch to see if the market sets up again. If it does, then consider paper trading it again. There's no "law" that says you can't reenter a market.Remember to stay on top of the weekly Friday emails as well as our It Just Happened announcements. You can do so by checking your Members Mailbox at www.wgbmembers.com.
Charts of Fire asks:
What kind of money management wisdom can you impart to us this evening? I find deploying capital in efficient amounts one of the most challenging skills. at 7:06:25 PM
Charts of Fire...... I'll type it in all caps...... PROTECT YOUR TRADING CAPITAL AT ALL COSTS! As a trader it's your most important asset. Put your "employees" to work for you ahead of time. By that I mean, once you're in the market put your stop and potential profit target orders in place and let them work for you. Then let the market do it's thing. And don't, under any circumstances, move your stop loss further away from where you originally placed it! Okay, I'll get off my soap box for a little bit :)Paul from Midland, Ontario asks:
Hi Jim,
You keep teasing us and hinting around about "things to come," LOL.
Care to kiss and tell us some of those things tonight? Hint, hint, LOL...
Just teasing *wink* at 7:08:41 PM
I'm told we are about two-weeks away from unveiling our new site. That's all I can tell you now.... ;)BigD asks:
Oct UNLEADED GAS has been dropping off very extreme for the last approx. 6 weeks... I personally don't expect this to last because of the way it is going down... I'm waiting for the turnaround, and be ready for it to retrace to 2.10 a gallon ..... What do you think, Jimmy?? at 7:11:55 PM
Frankly it's not a market I trade and neither is Natural Gas. They are just tooooooo crazy. Did you happen to catch the news about that Hedge Fund that got killed in the Natural Gas market? Check it out here at the NY Times: Hedge Fund Suffers Massive Loss In Natural Gas.Sam asks:
Hi again, Jim - wondering why it's important to also follow the front month. This is something that I haven't been doing. at 7:14:50 PM
Sam, Generally speaking the front month is the contract month with the most volume and open interest. Thus it's kind of the "driver of the bus" if you will. As a passenger, even if you're not driving the bus you still need to know where it's headed.David Goodman asks:
Hi Jim, I will soon be starting my trading and wanted to say thank you, for the information and teaching that you've given me. I am currently serving in Iraq and would like to start building my new life for me and my wife after coming home. I've been trying to keep up with your business for some time now, just never had the capital. I'll just try and do like DeeBeeTexas. Thank you again. at 7:19:28 PM
Glad to help, David! Great to have you with us tonight! You can learn a lot from paper trading so I encourage you to keep at it. You never know which way life will turn. You may not have the capital now, but you might sometime soon. That said, remember the following no matter what. . . never trade with the rent money or money needed to buy food! Only trade with risk capital! We are speculators in the markets -- not guaranteeeeeeeors. Anyway, take care of yourself and be safe. Please join us as often as you can.mrosner asks:
mrosner in Hollywood FL. Hi Jim. Regarding the 1-2-3 formation, when you wait for prices to "break the #2 point", do you mean to pass the #2 point or to actually close past the #2 point? Please clarify. Incidentally, I'm very pleased with all that you do! at 7:22:17 PM
While you can trade 1-2-3 formations either way that you mention, I personally prefer to wait until the market closes beyond the #2 point. Just a personal preference. Sometimes this approach will help avoid false breakouts of the #2 point. Glad you enjoy the work we do. We have a great crew here at US Charts and are happy to help you as much as needed.BigD asks:
can the EUROYEN go above 100.00? at 7:25:20 PM
That's actually a very "deep" question. Theoretically the "ceiling" is 100. However, I'm not an economist (nor am I that fast of a typist) so I can't give you the 100 page answer here. For argument sake though, chances of it going above 100 are pretty slim.trwtrader asks:
Jim,
Do you ever enter a market in the 1st day of an extreme rating with a breakout on the chart in that direction, or do wait for a strong rating? Thanks. at 7:27:42 PM
You can do it either way. Sometimes the market will spike just prior to the breakout and the TSR will change to extreme. Then maybe the following day prices will breakout of the formation. If you don't trade the breakout because of the extreme TSR there's a very good chance you might miss the potential move. I'd paper trade this scenario just to make sure you're comfortable with it.beefman asks:
Snohomish, WA Thank you very much to you and Ken for all you do and have done!
I recently had my first non-option big profit ride- lean hogs on a contract high breakout. I got stopped out well short of my upside target- 50% on the weekly- the market then broke out again with
new contract highs I jumped in again- but had to give up some profit when prices went down quickly there after. Was it fundamentally sound to get in again - or did I get greedy ? at 7:31:06 PM
Welcome beefman! Pretty country in Snohomish. . . In regards to your second trade. . . if that's part of your plan then you did right. Of course not every trade will work out. But how do you know ahead of time? You don't. So if presented with a setup why not take it if it's in your plan? By the way, my definition of greed is letting a short-term losing trade turn into a long-term investment. You did the right thing by getting out when your plan told you to.geogan asks:
Hi Jim, at what point should one feel ready to take the leap from paper trading to searching out a brokerage? at 7:34:49 PM
When you're comfortable and only you know when that is. Ken used to say something like: you're ready when you're tired of making profits on paper." The bottom line is only you know when you're ready to put real money at risk. There is nothing wrong with paper trading, so take it slow. I met a guy about a year and a half ago that had been paper trading for the prior 10 years! That might be a bit excessive but prior to that time he wasn't comfortable. Go at your own speed. . . you'll know when the time is right.gunnar monson asks:
Hi Jim, What amount of capital is recommended to open an account?
at 7:36:42 PM
It varies from broker to broker. Some will let you open with as little as $1,000. Some not less than $10,000. But the average is somewhere between $2,500-$5,000. Your best bet is to check with several brokerages and get an "average."Smokeydog asks:
Hello Jim! at 7:36:59 PM
Hello Smokeydog! Welcome. . .Dave C, Natick asks:
In answer to DeeBeeTexas, I am a big fan of the "TOP DOWN" approach, and the weekend is important to me to look at markets from the Monthly, Weekly, and Daily charts. I prefer it when they and Trend Seeker all agree on the trend. This gives me better than a 50% chance of entering a profitable market. "The trend is our friend until it ends." Any thoughts? at 7:39:35 PM
I couldn't agree more Dave! In fact I did a video about the Top Down approach back in June I think it was. Having all three charts and Trend Seeker pointing in the same direction make our chances of success just a little bit better.CubanaMike asks:
Hi Jim,
Just wanted to say thanks for all your help and everyone there in Grants Pass. Just exited an OJ trade and made 600 and I'm currently up 300 on corn. Take Care. at 7:47:55 PM
Hey CubanaMike! Nice trades! Keep up the good work!joeh asks:
Hello from KS
Generally how many trading days should a 123 take to shape up? Thanks
joeh at 7:51:41 PM
It is my opinion that 1-2-3 formations can appear in as little as four days and with really no limit as to the maximum number of days. These are just my "rules of thumb" though. Paper trading will provide you with the answer as far as what works best for you!ladygarnet asks:
Hi, Jim
I want to know if the "Premium Alert" videos are up and running. I have tried to view them several times, but cannot get anything. Yet, I get the video trading lessons alright. at 7:53:17 PM
Hi ladygarnet, They are not up and running yet. Hopefully they'll be going sometime in October. We will let every one know exactly when that service will be available. Thanks for your interest.Monstercash asks:
Jim, is it possible to have a lesson on how to build your option account (money management). Example, how to buying more than one option to piramind your profits? at 7:56:56 PM
Hi Monstercash, That's a tough one to do a video on because technically you can't pyramid option profits. Using futures contracts you can internally finance the purchase of more futures contracts with profits. But with options you can't do that. You actually have to liquidate the option and then use whatever profits you have to buy different options.Up Up and Away asks:
Jim - It seems as if you are pretty consersative with your trading account which leads me to believe you get stopped out before you realize the biggest move. Do you remember Daryl in the video Ken did about 10 years ago. He started with one contract and made made $234,000 by adding contracts as prices went up with stops in place. I know we all have different trading styles but give us some hope that trading the different strategies can lead to big results. Perhaps an example if you will. at 8:01:33 PM
Any of the strategies we provide can do this. However, it is my opinion that most traders try to hit the home run but invariably strike out. Thus most are out of the business inside a year. Sure you can get lucky on a trade but for most it is not realistic to expect to make a quarter million dollars on one position. Trade for singles and the big winners can come. I am conservative. Noboday cares about my money more than I do. As far as an example. . . the first one that comes to mind was the beautiful pennant formations in both Gold and Silver back in the first part of this year. Had a person traded those formations (as pointed out in Ken's Chart Book) they could have done very, very well. There were multiple opportunities in Crude Oil, Copper, Sugar, Soybeans, and Soybean Meal just to name a few. All of these opportunities were pointed out in Ken's Chart Book as well as our weekly emails -- and all happended this year! Keep on truckin'! rick asks:
just recieved "my favorite market now" I recommend it to everbody, very good stuff. at 8:04:07 PM
Thanks for the comment, rick! We appreciate it and I know that Ken will too.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 lesson at: www.uschartco.com . This is a fantastic teaching tool and free to all Online Chart subscribers! (The video link is in white text located at the top of the very first page you see after the disclaimer when logging in.)
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!(tm)
My next chat will be on Tuesday, October 17, 2006. God Bless and I look forward to seeing you then!
Chat Opening
Hi everyone, Trader Jim here. . .
