You
have subscribed to Joe Ross' Weekly Spread Scan Newsletter.
If you have problems reading this newsletter, please follow this link:
Spread
Scan Issue: October 17, 2007 - Volume 166
This email was sent to you by Trading Educators.
To ensure delivery to your inbox (rather than to bulk or junk folders)
please add info@spread-trading.com to your address book.To unsubscribe, scroll past the end of this newsletter and
click the "unsubscribe" link.Otherwise, welcome to this week’s issue of the
Joe Ross Spread Trading Newsletter.Each week we present spread trading examples and opportunities in order to help
you become a more professional spread trader.
Be sure you receive all your issues of Spread Scan so that you can continue to enjoy learning through the best free educational trading information available, and so that we can keep you informed about additional educational services and products to help you grow as a successful and profitable spread trader.
Today we consider a calendar wheat spread: long July 08 Wheat and short March 08 Wheat (WN8 – WH8). The spread has been in an up trend in September, after falling like a rock in August and early September 07. Wheat is very volatile at the moment, and the same is true for the spread. Even if a calendar spread is usually less volatile and less risky than an inter market spread (spread in two different markets like W - S), I would recommend at least $1,500 for the risk.
Traders may want to enter the spread market on close today (MOC). Initial margin for the spread is $1,620 (reduced margin). Suggested risk is $1,500. Initial projected objective is $1,500, then higher. Basis is seasonal (app. 10/25 – 1/28) and a RH.
On September 20 we told subscribers of our professional daily spreads & position trading newsletter Traders Notebook, "Consider entering an inter-market meats spread 400*LCG8 – 500*FCX7 at -$17,800. Initial margin for the spread is $2,633 (no reduced margin). Suggested risk is $1,000. Initial projected objective is $1,000, then a move higher. Basis is seasonal (app. 9/18 – 10/25) and a break out of a trading range. Please check with your other trades!"
Here's how we suggested managing this trade:
09/20 Suggest entering MOC tomorrow.
09/21 In?
09/26 Suggest moving stop to -$17,930.
10/12 Suggest moving stop to -$17,700.
10/15 Suggest moving stop to -$17,440.For more information about our daily newsletter, visit our Spread Website to find out more about Traders Notebook
Questions or Comments? Please email us: support@spread-trading.com
Student's Question: "Andy, I just wiped out for the second time. Am I some kind of trading freak?"
Andy: Most successful traders have failed at some point in their careers and wiped out their account. Many traders lose because they do not understand the nature of the decision-making process, which should be based on rational price action analysis versus emotional, irrational reactions to price action. A reason should be required for each market action taken. When fear exits a trade, it is more difficult to take the next technical signal. Traders will eventually become confused and feel guilty due to indecision. Do successful traders buy an education with the mistakes they make?
What separates the winners from the losers is that winners learn from mistakes, refine the decision-making process, keep on trying and never give up. If traders cannot accept the losses that go with the trading, they do not deserve the profits. Failure is the greatest teacher only when a student is prepared to learn. If the student has forgotten previous lessons, or the dog ate his homework, he is not ready. A positive attitude has positive expectations of future events, and normally precedes the success it creates.
Another reason for failure is that traders fail to understand the real nature of the markets. They do not understand where prices will move, why they will move, and what it is that makes them move. That’s why we teach these things at our seminars.
Profit-making concept — keep trading simple using the LAW
The truth is simple, and the charts in the markets follow a law. I call that law
The Law of Charts™
The Law of Charts™ brings you the pure simplicity of what the market is all about. Trading markets does not have to have to be complicated. Everything you need to know to make money in the markets is right there before you when you look at a chart of the prices in the market.
Some traders think that the more complicated something is, the better it is, when the truth of the matter is just the opposite. Every time you view a price chart, the truth you need for making money is staring you in the face. It is looking right back at you.
There is truth in every price bar you see, and in every group of price bars there is additional truth. It doesn’t matter whether or not you use traditional or candlestick price bars. The truth is the truth, and you will find it on the charts.
You will have to think to find it. You will have to use your imagination. The truth of the markets is not going to be found in an indicator or a mathematical formula. You will not find it in Fibonacci ratios, Elliott Waves, or Gann theory.
I don’t mean that people cannot make money using those things. What I do mean is that if you are able to throw off all the complications of theories, indicators, and mathematical ratios, you can come to see what is really there on the chart when you look at it.
My students have told me that once they understood the markets, all they ever need to trade them profitably is an understanding of the Law of Charts™ along with the dynamics of the market. You are going to receive both of these and more, learning to trade profitably from this simple trading concept of the LAW of Charts™. Follow this link for more information about the ONLINE SEMINAR which you can take right away!
©
2007 by Trading Educators, Inc
Contact
Us
1509 Jackson Drive
Cedar Park, TX 78613
Phone: 800-476-7796 or 512-249-6930
You
can e-mail us: support@spread-trading.com
Office hours are Monday - Friday 9 A.M. to 5 P.M., U.S.C.T.
Unsubscribe or change subscription
To change your subscription or to unsubscribe, scroll past the end of this
newsletter to click the "unsubscribe" link.
Disclaimer:
The Commodity Futures Trading Commission has asked us to advise you that trading spreads or outright futures is complex and carries a high degree of risk. While there is opportunity for incredible wealth building, there is also the risk of losing even more than you invested. Of course, that's not unlike most other businesses. But informed traders are the best traders!