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Okay, lots to cover today; let's get going . . . .
Read what I went through to get you the Million Dollar Cake's secret recipe
Did you see last month's Chat Photo Caption Contest winner? It's fantastic.
(Also see our first-ever DIS-honorable mention winner.)

This Week's Chat Archive
  • HomeBizJoe wants to know my favorite trading strategy at 6:21

  • Are you hesitating to "pull the trigger" too? See power08 at 6:27.

  • Did you ever see a $15,000 option? See TOVI!TOVI!TOVI! at 6:43.

  • I'm getting to know you even better now! See my new Member's Survey just past 6:46.

  • Listen to me now, believe me later . . . . See my NOTE: just past 7:00.

  • Are you clear on the Active Futures Month? See Sasquatch at 7:37 and tonytenn at 7:47.

  • Do you think my Chats are slow? not George at 7:48!

  • See Muppet Show Extra at 7:51 (and then Dave's response at 8:09). Don't listen to Dave!

  • dax is doing "EXTREMELY" well with just this one single strategy (8:01).

  • indamone made $26,400 while he was away on vacation (8:02).

  • dax follows up on his simple plan at 8:12.

  • I don't typically beg, but I'm begging now (just past 8:16).
Commodities

Here's something to share with your "Tax the rich!!!" friends
Until Next Time,
Ken

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Copyright 2004 - The Ken Roberts Company



Let's Talk Trading (tm) with Ken Roberts
from November 9, 2004

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 Zino Robusto fired up, heres our Million Dollar Cake (see the true, capitalistic story under Chat Essentials on the KRC website!), the 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.


HomeBizJoe asks:
Ken, what is your favorite trading strategy: 1-2-3', channels, etc.???

at 6:01:05 PM
Great question. Glad you asked, HomeBizJoe! I'll tell you: I'm VERY excited over the Hi-Lo Breakout Strategy (futures AND options). Give it a try (many markets are candidates now --- see Ken's Chart Book) and please let us know your experiences with it.
power08 asks:
Ken, I'm a first timmer. I've had the course for a couple of months but just recently went thru it and now I'M READY TO GET GOING. I'm comfortable with TOVI and somewhat comfortable with the charts but am having difficulty "Pulling The Trigger" sort of speak. Not sure how to interpret the information and select the right option. Can you expand on this? I would imagine I'm not the first to have this emotion.

at 6:27:25 PM
Oh, no, power08, you're not the first (we all did), and you certainly won't be the last. Okay, here's the paper-trading plan I'm prescribing for you: Take the Hi-Lo Breakout Strategy and the newly posted 1-2-3 Strategy. Now go through EVERY daily active futures month and notate those markets that are making those formations. Then monitor each of those charts every day. The "trigger" to enter either kind of trade is black-and-white. When one of those triggers is hit, choose your option according to the directions given in each of the Strategy files. Also at the time of "entering" that market, choose an EXIT strategy and stick to that. By this time next month, we all expect your progress report! Now go forth and papertrade!
Jeff asks:
I'm new to your chat room and trading and have no questions at the time, so I'll just observe. I'm sure that I'll have many questions later on.

at 6:27:46 PM
Thanks Jeff. Welcome aboard!
Jack asks:
Hi Ken! You seem to really have fun with your business. I'd like to, but the fear of losing seems to get in my way. What advise do you have for someone who's eager, but scared?

at 6:29:09 PM
We all were scared, Jack, but as Vernon Howard used to say, "Proceed while being afraid." Paper trading makes this especially easy (but oh, so educational) to do! Keep us posted . . . .
Mackeral asks:
Mackeral, Truro. Nova Scotia, Canada. Ken, I enrolled in your original TWMPMM course back around 1999. Paper traded for about six months. Made a lot of money but lost more money. Took a four year breather and I'm back again.Do you strickly trade options? I haven't seen any futures contract trades in your chart book.

at 6:31:00 PM
Yes I do trade futures too, Mackeral. But it's so important for people to learn options as well as futures. (Remember: I didn't have options when I first began trading back in the Colonial Days . . . .)
scat asks:
When you have been away from active paper trading for a period of time and we are trying your new system what should we do first and second to get into the swing of things again?

at 6:32:02 PM
Thanks scat! (See power08 at 6:27)
david asks:
Hi Ken! I used to trade futures with you several years ago. I have been out of trading since then. It sounds like options are what you are recommending now. Like others, I have had successes, but also wound up losing more than I made because of inexperience on my part, as well as my broker, who was young and inexperienced. I like the idea of controlled risk with options, but it doesn't seem like the potential for rewards is big enough to strictly do options. Your thoughts, please

at 6:34:22 PM
Actually, david, options can make MORE than futures contracts because of volatility! You need to learn options, david, and I think you'll be a big fan of them. Start with the Hi-Lo Breakout and 1-2-3 Strategies! Thanks.




martin asks:
I just started paper trading 3 weeks ago, and I'm having a blast trying to learn it. I read in a chat archive where you mentioned about finding a comfort trading zone, i.e. $800 options, or $ 500 options or $200 options. But I did not see any comments about which size of options in your experience generally produces the great percentage of returns. I would guess the smaller one, but can you share any insight? Martin F., Arrowhead, CA

at 6:38:51 PM
Welcome martin! (I love Arrowhead water . . . .) I have no statistically valid facts to quote you on this, and I've never seen any published anywhere. When making a (paper) trade, however, why not try, say, three or four options of varying price and see how they pan out? Please let us know your results! Thanks.
Apilgrim asks:
I just finished "A Rich Man's Secret." Thank you for the footprints. and I have just begun paper trading.

at 6:39:21 PM
You did it in just the right order, Apilgrim! Congratulations!
tarzan asks:
What do you do when you are holding a position in a market or several market and the markets are moving against you.

at 6:42:44 PM
Hello Tarzan! It's all based upon my EXIT strategy (which I set BEFORE I entered the trade). With options, however, I can allow a market to move WAY against me and still remain in it. My trading buddy and attorney, Mike, and I were just discussing this today. He's holding several Cocoa calls and has withstood a rather large downswing, but his options are good until this coming June, so he's not worried at all. Try it!
Yoda asks:
Howdy Y'all.........I really think last months caption contest winner should have been the Dishonorable one....."Go Ahead, pull my finger" LOL It was a classic one to say the least. LOL

at 6:43:19 PM
I'm not sure Todd agrees with you . . . .
TOVI! TOVI! TOVI! asks:
Hi Ken! I want to tell you that I liquidated my Dec. 40 Crude Oil call option for $12,000 on Oct 19th. Orig. cost - $550. What a trade! It went as high as $15,170 a few days later, but has been declining ever since. I got out almost at the top! Dave

at 6:43:55 PM
You can't lose money taking profits, Dave! Congratulations!
TOVIJUNKIE asks:
Hi Ken and crew,On the WGB update for 11/5 you mention shopping for calls in Dec hogs based on the Hi-Lo Breakout Strategy,but in using TOVI as a tool I see that as of 6/11 Hogs has been in an uptrend for 40 days. Isn't that too long in the trend to trade it?or is it when using the Hi-Lo Breakout Strategy you can go with more days in the trend? As usuall thanks for all you do,TOVIJUNKIE

at 6:46:23 PM
Great question, TOVIJUNKIE. The Hi-Lo Breakout Strategy does not take into account the length of the trend so far. When a breakout of an old high or low occurs, that's quite an event in that market, so in the Hi-Lo Strategy, we hop on board at that important point. Try it. I think you'll be as big a fan of it as I am. Glad you joined us this evening.




My new Course Member Survey has been up just a few days, and boy am I learning all about YOU! This is great! I just learned that over 70% of you are on broadband connections which means that we can offer you EVEN MORE features than we have because most of you can utilize them (rather than just being frustrated by huge file sizes)! So thanks for helping me help you (because it's really just the same thing, you know . . . .)
Scott in Sebastopol asks:
Hello Ken, just picked up some may corn calls and watching closely for some soybean meal calls as well. Wondering what you and TOVI think about gold calls tonight. Thanks for teaching us all this interesting and exciting business, it really does teach us a lot about ourselves.

at 6:54:01 PM
TOVI likes Gold, Scott! Check out its Short-Term Rankings. Thanks!
Jack asks:
Jack,Mount Shasta,California: Ken, you had to start at the beginning as I have to now...What was the one thing that convinced you that you could be successful at trading?

at 6:57:07 PM
That's a great question, Jack. Let me see . . . . I think THE fact that helped me the most was that my Deputy Sheriff friend was there watching as I made that first trade. Knowing that he was successful at it just naturally let me know that I could be too. And this support is what I try to offer to everyone who becomes my Course Member too (which is easier than ever now because of the internet!).
markc asks:
On your GAB Weekly Update for 10/22 you recommend paper trading Wheat call options. I also received the WGB Weekly Update for 10/22, here you seem to indicate we should look at put options. Why the discrepancy, or am I just reading this wrong?

at 6:58:31 PM
GAB is a long-term trade (with deep-out-of-the-money options) and WGB is a short-term trend trade. Paper trade both! Thanks!
pete asks:
ken once i decide which market to get into what is the best way to decide which strike price and which month to get into?

at 7:00:32 PM
If you're on TOVI, pete, let TOVI find it for you (based upon your input). If you're choosing an option on your own, get at least three months' time till expiration, and find one as close-to-the-money as your budget allows. Clear? Thanks!
NOTE: Donna from Four Star Books just walked through --- she's been processing all your Dr. Hawkins' textbook and CD Workshop Set orders! --- and said that we should receive our next new shipment of CDs next week!!! Better call her tomorrow and reserve your copies . . . . (Listen to me now, believe me later . . . .)
UP2U asks:
Ken-Funny thing tonight - I told my 3 yr old daughter that last week I had a TOVI chat and tonight I have an almost tovi chat and she says I have one too. I said alright never to young to learn the markets. It turns out it was a Fisher Price TOBY the Totbot. I thought maybe KRC will hook up with Fisher Price on a TOVI board game for XMAS. Perhaps a TOVI character doll. You know at Disney you can now get a Mickey Mouse that is rigged with GPS to guide you anywhere in Disney. Alright enough dreaming. In using Tovi, I have found that in my paper trading futures from mod to strong and confirming a formation has been successful enough that I did not need an opposing option for insurance. Have you noticed this? I was stopped out with small loses on 2 of 10 trades and profits on the rest! Your thoughts?

at 7:05:16 PM
That's what I'm finding too UP2U!!! Good goin'! Say hello to your daughter (that little capitalist!). Great ideas for TOVI toys, games, etc. I love it! (We should post a picture of Dr. Ellie's halloween costume this year --- she came as TOVI!!!)
Gary asks:
Hi Ken, I've been a course member for 10 years but recently my account has dribbled down to just enough to have bought a "way out", 145 March OJ call yesterday. I remembered what you said about OJ's all time lows and not being on board in all your talks over the years. Do you think it would take another hurricane to push prices up or would a good old fashioned freeze or even a scare of a freeze do it since it's the winter season again? I can't believe how much fun you're having with your courses over all these years. Cheers!

at 7:06:59 PM
Yes, we're all very lucky to have found commodities, aren't we?! Yes! Any rumor could cause those OJ prices to soar. And YOU'RE the smart one because you're on board way before the rumors . . . .
pork chop asks:
Pork Chop asks: Hi Ken! If the market goes against you on your option and you make the decesion to get out of the option can you usually liquidate the option before all of the premium is used up.

at 7:08:58 PM
Sure, pork chop, as long as that option still has value (a premium), you should be able to liquidate it at that price. Reminder: Have your EXIT plan in place BEFORE you purchase it! Thanks.
BRIAN FROM ROCKLIN,CA asks:
HI KEN, THANKS FOR HOLDING THESE CHAT ROOMS. MY PAPER TRADING PLAN IS GOING VERY WELL -- UP ABOUT $3000.00! MY ONE QUESTION IS.... HOW DO I PICK THE RIGHT MONTH WHEN THE FRONT MONTH IS NOT MAKING THE SAME FORMATION AS THE OTHER MONTHS ( ie. worlds most powerful money manual)? I AM ALSO PAPERTRADING THE WGB AND I FIND THAT I CAN TRADE MANY MORE MARKETS THAN BEFORE! I'M LEARNING MORE EVERYDAY. THANKS AGAIN

at 7:10:48 PM
You sure are, Brian. Thanks! Unlike what I taught in TWMPMM, now follow the Active Futures Month (it's always listed on the TOVI Trend Tracker at www.uschartco.com).
Rick asks:
Ken, In a previous question you replied you can make more money in options because of volatility. Why can you make more?

at 7:15:31 PM
Let's say you're long an OJ futures contract from 100. You also have an OJ call with a strike price of 100. OJ is now trading at 105. Your futures contract is up $750 ($1.50 x 500 pts.). Your call option will have AT LEAST $750 profit built in, but it may be worth EVEN MORE if the OJ futures market is volatile. In other words, your futures contract can ONLY be up $750, but there is no such limitation on an option. Hope this clears it up. Thanks!
Krispy Kreme asks:
Paper trading has taught me a lot, but I'm having some trouble placing orders. I only have 1 chance in the morning to check the markets and place orders. How do you price your orders when you want to get in the day after TOVI gives the Strong signal?

at 7:17:24 PM
I see no problem here, Krispy Kreme! Let's say TOVI gives your signal today (Tuesday). Tomorrow morning, call your broker, get option prices, place your limit order(s), and you're done! There: The World's One Perfect Business . . . .




mule asks:
Thanks for your time! In august I exited out soybeans a week before my (put) option expired. I got out with my initial investment, but I then watched soybeans plummet four days before expiration. Is this common? I thought I was doing the right thing. HELP!!

at 7:19:26 PM
Yes, it's common, mule! We ALL have "war stories" like that to tell. But don't let the turkeys get you down!
tonytenn asks:
Which 50% retracement matters the most, the daily, the monthly or weekly? going with my other question, is the 50% retracement is different with all the trading months? i'm confused about that sir.

at 7:23:16 PM
I use the Active Futures Month as the ONLY daily price chart I watch, tonytenn, no matter what month I'm TRADING. I can't say that any one of the daily, weekly, or monthly 50% levels is MORE important than another --- they're all important. It just depends upon your trading perspective. For example, if the Active Futures Month price rose up and off the chart, then I'd be looking at the weekly 50%, and if prices leave the weekly chart, I then look to the monthly 50%. And I typically use these 50% points to "peel away" contract/options and take profits along the way. Hope this helps. Thanks!

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Did you get that? And while I'm at it, let me just remind you to be sure you're on my email list so you'll receive all the great StarBursts, Surveys, Contests, and Guidance I'm sending more and more of lately.
freeatlast asks:
Don't the same principles and tactics which you use for options work pretty much the same exact way for futures. You seem to only talk in terms of options now adays. Is this just because you want to demonstrate a careful conservative approach to trading? Do you still like to trade fututes?

at 7:30:43 PM
Yes. Yes. Yes. (Any other questions?)
Patrick asks:
...from St. Catharines, Ontario Canada. I just wanted to say thanks. I held onto that gold option that I mentioned in the August 10th's chat session and took $600 profit on Aug. 20th (just above my target). It paid to "stick to my plan"!

at 7:33:02 PM
Congratulations! I love the "just above my target" part, Patrick. That tells me you're working the market; not letting it work you! Good going! (Say, have you seen Robert Redford recently?)
ScottsGirlTrader asks:
Ken, I have been paper trading for 2 months, and I am batting 100%, I am having trouble understand Tovi's Trend Tacker! It goes against all you have taught us!

at 7:36:32 PM
SGT, don't use TOVI's Trend TACKER, use TOVI's Trend TRACKER!!! Okay, I'll agree that it "goes against" all I taught you if you mean that it's NOT contrarian. My perception of contrarian has changed over the years (and thus TOVI was born). I have found, however, that being on the right side of a trend IS, indeed, contrarian! Thanks.
Sasquatch asks:
Ken, lately in the meats markets the charts are "inverted" according to my broker which means that the farther out markets are actually trading at a lower price than the earlier or front months. This caused the 50% weekly retracement level to be backwards from the 1-2-3 formations that were forming. How do your trading stradegies apply to these markets? Thanks, Sasquatch

at 7:37:30 PM
I just watch the Active Futures Month, Sasquatch, and take all my trading cues from it. Try it and you'll see what I mean. Thanks!
the Jay man asks:
Hey Ken, I'm thinking of loading up on corn when it hits it's 25 year low, with an out of the money call option. I just need to figure out how to beat the commisions. What do you think? -Jay

at 7:38:14 PM
Well let me know if you figure that out, Jay, because I haven't!
Gypsy Woman asks:
Kaptain Kenny! Follow up to last chat when I missed liquidating my Mar 80 OJ call at its'1 year high. Well. I waited, thinking I still had lotsa time and am reporting back to you that I ended up liquidating it with a much smaller profit, but still a profit! I also liquidated my Cocoa put, this one with a loss of several hundred $. Now. I am making $ on my Eurodollar put(s) and my OJ Mar 75 and 80 puts with the $ from my liquidations. Point of interest - my further out paper trades on Canadian $ each have a couple thousand $ in intrinsic value, as well as my Coffee paper trades. I don't think I see things that aren't there, simply put, I've learned to spot an opportunity and wonder of wonders it all works out on paper more times than not! I have less than $5K invested and sure would have liked to jump on Australian $, Lean Hogs,Lumber and Soybeans (all of which I paper traded and made a tidy sum on) - look out world, she's ready to use real $! Thank you again for all you do - y

at 7:39:56 PM
Great goin', Gypsy Woman! Thanks for the update --- we love them!
pete asks:
Ken. In the answer you gave to Scott you said, "TOVI likes Gold, Scott! Check out its Short-Term Rankings." What are Short-Term Rankings and where are they found?

at 7:41:07 PM
They're at www.tovionline.com, pete. Take my Tour while you're there! (You'll also find an abbreviated version at www.uschartco.com.)
newventure asks:
Ken, what time frames are short and long term trends considered? Thanks.

at 7:41:37 PM
Rule of thumb: Short-term = 3 months or less. Long-term = More than 3 months.
freeatlast asks:
I have had serious problems with 3 different brokers. Everything you said was right. I have been killed more by being talked into things by brokers who tend to try to intimidate me with there advanced skill. How can I find a really safe trustworthy broker who will not pressure me??? Is there a website that rates brokers?

at 7:42:41 PM
Not that I know, freeatlast. Have you tried my Names&NumbersToKnow?
dax asks:
Hi Ken! I know that options allow us to stay in the markets through periods of volatility. What confuses me is when you should let a large loss show up on your option trade, continuing to ride it out waiting for it to recover. I have not done ANY of that - I generally get into the markets (paper trading), stay in the ones that are profitable, and only accept about 20% loss of my original option price on the "losers" before exiting. This strategy is working, but I think there is a better one, using trend lines, exiting when the current trade crosses it. I'd like to expand my "exit horizons"! What do you suggest?

at 7:43:38 PM
What you said, dax, sounds great. Try it and then let us know! Thanks.
memphis asks:
Hey all. Ken I also enrolled in your TWMPMM, but was scared to pull the trigger, but as you see I'm back. I currently have two positions, based on the previous course. I recently subscribed to TOVI, however I fill Alittle info overloaded trying to process this data. Isn't it possible to have to much data to make decisions from? I mean if you look hard enough at enough data you start to become triggerless>

at 7:46:52 PM
That's true, memphis. Just take it one strategy at a time. Keep it simple. As I once said, TOVI is a 747. If you're a new pilot, you could easily become overwhelmed looking at that instrument panel! But as a new pilot, you can still fly that 747. Then, as you become accustomed to its workings, you'll just naturally want to branch out and consider some of those other dials and switches to see what they do and how they make flying easier. You're doing just fine . . . .
tonytenn asks:
the active futures month is the same as the front month right ken?

at 7:47:37 PM
Not always, tonytenn. It's generally the daily contract with the most Open Interest. Thanks!
George asks:
Santa Barbara, CA, Ken & crew, someone in Newport Beach made a comment about the chats being slow!?, something very different tonight, is it a Turbo? you keep on getting better and better. Thank you very much!

at 7:48:21 PM
You're my new favorite Course Member, George. You da man! Thanks! Gotta go now . . . .
asks:
Hi, Ken--I absolutely LOVE this stuff!!! Thank you for introducing me to this business (it's been a long time since that first flyer in my mailbox back in 1995). My question is: Have you been dabbling in any spread trades (i.e., bull put spread, etc.) since the advent of TOVI? I ask this because you mentioned an option writing module in the near future. Thanks...

at 7:49:38 PM
Funny you should ask! I HAVE been dabbling in option spreads (as research for our new WRITING options module that's on its way). (Have you been reading my mind?)
Muppet Show Extra asks:
Hello Ken--First of all, THANK YOU for introducing me to this business. My question is, how do you develop the GUTS to stick out a trade like the one Dave made (at 6:43:55 PM)--I have developed a habit of exiting early for fear of losing the little profits that I have gained. What gives?

at 7:51:03 PM
A PLAN, Muppet, is what gives. Make that plan and stick to it! (Hey Dave? Still with us? What say you to Muppet's dilemma?)




GreenTrader asks:
Dear Ken and gang.. I'm long one Dec Corn from 221 (Currently at 198), with a protective 220 put. With the loss on the future and gain on the put, it's about an even wash..as advertised. My question is, with the expiration of the put option rapidly approaching, should I bail now and re-enter that market at a later time. Thanks for all you do...

at 7:54:19 PM
Consider exiting BOTH your futures and option, GreenTrader, since you're now at break-even. Then re-evaluate another entry strategy. Believe me, you've learned more than you now may realize. Great goin'! Thanks.
gugu asks:
Bought the TWMPMM course four years ago; now i'm back and enrolled in the new course, starting paper-trading. Do you recommend a broker? Gugu from BC, Canada

at 7:55:13 PM
Yes, gugu. See my Names&NumbersToKnow file at www.kenroberts.com. Thanks, and welcome aboard! Eh?
HomeBizJoe asks:
Ken, Can one use www.tovionline.com instead of uschartco.com if they are only trading options?

at 7:55:47 PM
Sure HomeBizJoe, but I couldn't do it without my charts . . . .
Patrick asks:
Actually, it's just a comment. Thanks for answering our questions, Ken. You're the World's Greatest Dude! Have a GREAT night :)

at 7:56:11 PM
And you are a genius, Patrick! Thanks!
Donnie asks:
When crude oil made all time high were you looking for put options even when the tovi showed up trend?

at 7:57:10 PM
Yes, I did peek at some puts, Donnie, but I've newly learned to stay with that trend!
the Jay man asks:
Ken, Would you hesitate to buy call options if prices look high on the monthly chart but still look like they might go higher on the daily? -Jay

at 7:57:47 PM
A lot of people did just this, Jay, and missed out on Crude Oil!
Cindy asks:
What an unusual trading day in the corn market. It's trading range was only a couple of cents today, then it closed all months unchanged from yesterday. Is there nobody trading corn, does it mean anything?

at 7:58:50 PM
It means people are trading it, Cindy, but no one broke into new ground today . . . .
Russ asks:
ken i have 3 put options in pork bellies for feb would you recommend cashing them out and buying 1 feb call option or hold the position i now have Russ

at 8:00:03 PM
What was your entry plan, Russ? And then what was your EXIT plan?
dax asks:
Ken, to memphis I would like to say that so far, myself and a friend of mine spend just about every bit of our available trading time using the single strategy of entering markets the day after they move from Moderate to Strong! We have done EXTREMELY well with just that one strategy! I really really REALLY want to discover and start using some of the other trading strategies that TOVI (from the TOVI website) offers, but we just have not had the time yet! That is just an example of my experience regarding what you wrote to memphis. Thanks!

at 8:01:06 PM
Thank YOU, dax! That's been exactly my experience too! (Funny how great minds think alike . . . .)
indamone asks:
Thanks for everything it has been great Ken, mY Favorite success story since I started last november. I started with 10 K . within a month I had 16k. I went to the Dominican Republic on vacation in February. I made 26,400 dollars on copper the week I was away!! What a business1!!

at 8:02:02 PM
Thanks indamone, and congratulations! (Bet you found some really nice cigars on that Dominican trip of yours . . . .)
Trader Don asks:
Does the short term "trend", mean the same thing , as the short term "environment"??

at 8:02:44 PM
Yes, Trader Don. (Say, how's Trader Joe? Tell him "Hi" for me when you see him . . . .)
tonytenn asks:
yes ken, thanks for everything, man i have NO IDEA what i would be doing if i didn't know about this. i mean what else is better than this?!! you really gave me something to look forward to and MAN I LOVE MONDAYS, AND WISH THERE WEREN'T ANY WEEKENDS. SMILE!!!!

at 8:03:21 PM
Cheer up, tonytenn . . . . (You're welcome! And thank you!)
nmdsnyfan asks:
Ken! How do you determine what price to pay for an option on the high/low breakout. I sometimes have to place my orders before the markets open. Thanks

at 8:04:39 PM
In that case, base it on TODAY's price (which will likely rise TOMORROW), but could come back to fill your open limit order.
philly dana asks:
Ken, I have been a subscriber to US charts online for a couple of months now and I absolutely love them.However there is one indicator that I would love for you to add,that is the 4,18 and 40 day moving average.Any thoughts of possibly adding these? Thanks so much.

at 8:05:32 PM
(What are you up to, philly dana . . . .)
freeatlast asks:
Ken, I think your high low breakout is cool! In your original TOVI strategies, you mention a strategy of just going with things when they go from medium to strong the first day. How much should you also watch the charts? It seems that you have so many factors involved in your strategy that it's complicated. when do you know when not to add another factor. There is so much out there now to study, it seems it just makes things worse if you over think, Thanks a million,(Literally) you have freed my body and mind!

at 8:07:18 PM
Thanks freeatlast. Don't get overwhelmed. Stick with one basic strategy: Hi-Lo Breakout or 1-2-3, or Moderate-to-Strong, for example. Then don't think (or worry) about anything else! Let us know how it goes.
Byrdman in Miltown asks:
Hi Ken. Was a TWMPMM I & II member back in 1998. I fell off for a bit, but now I am back with a vengeance. I have a quick question for you. I am awaiting corn to break out to the low side to purchase a put option. Yet, I have read, on this chat, about course members purchasing calls. Is that because of a long term trading strategy?

at 8:08:53 PM
They're likely anticipating Corn's turnaround, Byrdman, but don't let that sway YOUR plans. Stick to YOUR plans!
TOVI! TOVI! TOVI! asks:
heheheh Well Ken and Muppet Show Extra - to be honest, I just had a tremendous feeling that crude oil was going to go through the roof last spring and summer, when I bought that option (April 8th). Then I sold it with the feeling that ANYTHING could happen before the election, especially if W was to be re-elected. Nothing technical about it - strictly funny-mental! Dave

at 8:09:55 PM
Sorry I asked, Dave . . . . (Did you get that, Muppet? Don't listen to him!)
NICKDOGS asks:
I LIKE THE ROBERT REDFORD COMMENT!

at 8:10:13 PM
!
the Jay man asks:
Thanks for chatting tonight Ken. You sure are a WISE man! -Jay

at 8:10:29 PM
!
Mackeral asks:
Ken, do you trade using a technicial trading approach only or do you also incorporate any fundamental strategies? ie.news bulletins.

at 8:11:01 PM
NO funny-mentals, Mackeral! All news is STUPID news!
dax asks:
Ken, I wanted to report to you continuing success with entering the trades the day after trend strength moves from Moderate to Strong - I did this recently with Live Cattle, and in about 11 days showed a 43% return on my (paper-trading) investment! I did the same with the S&P500 and had about a 54% return within 9 days! Fabuloso!! I'm looking for some solid exit strategies - currently I'm using as my indicator a 20% loss - either on my highest profits in the trade, or in my initial option price. I am also using 50% retracement levels and support and resistance levels in the charts. But there's still quite a load of guessing and intuition. Is that just part of it, or are there better exit strategies to be had? Thanks Ken!!

at 8:12:46 PM
It's an art, not a science, dax. But I like your thinking here. Keep us updated! Thanks.
tonytenn asks:
i have trouble with the different trading months. i look at the front month and while i see a formation, the other months are all at different prices, so i hesitate to get in. i hope this makes sense? how do you know which month to get in?

at 8:13:08 PM
Plan using that Active Futures Month.
ready2win asks:
You have said in past chats to bargain when purchasing an option. Is there a rule of thumb you use on how low a price to offer? Thanks

at 8:13:58 PM
No rule of thumb, ready2win, but try bidding HALF and see what happens (I think you'll be pleasantly surprised).
Patrick asks:
Now that T.O.V.I. is here, do you find yourself buying more "Near To The Money" options versus "Out Of The Money" options?

at 8:14:10 PM
Yes, Patrick.
Patrick asks:
...from St. Catharines, Ontario Canada. Hi Ken - I am almost going broke in Cotton. I made a boo-boo! I definitely didn't "stick to my plan" with this one. I bought 2 5600 CALL Options on Sept. 16th for $1,000 each and they're now worth only $90.00 ea. Ouch!! I was going to bail-out when support broke on the chart, but I didn't want to accept a -$300 loss. Obviously, that small loss has now grown to -$1,820 before commissions. Since there is still time before these options expire, I've been thinking about buying x6 more at the same strike price, to average the overall cost down. I am just a little unsure whether to buy the same contract month or go further out?? NEXT TIME I will stick to my plan!! Thanks for your comments.

at 8:16:45 PM
Thanks, Patrick. See what you can buy farther out. Time is your friend. (This will be a great lesson that will pay off in the future. It just may not feel like it now . . . .)
I'M BEGGING NOW: Come on! Send us those pictures of YOU on Chat Night! What are you, bashful?! I've shown you US, now let's see YOU!
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, December 14th (The next TOVI Chat is Tuesday, December 7th!). As always: Use these newfound powers only for Good. Good night, God bless, and watch where you step!
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