Joe Ross' Spread Scan Newsletter

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Spread Scan Issue: October 24, 2007 - Volume 167

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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.

Andy's Spread Scan Example:

This week we look at KCH8 – KCZ7.

Today we consider a calendar Coffee spread: long March 08 Coffee and short December 07 Coffee (KCH8 – KCZ7). The spread has been in an uptrend channel from the start. Is the breakout to the up side of the channel the starting point of the seasonal up move (app. 10/20 – 11/15)?

Traders may want to enter the spread at a value of 4.00 or better. Initial margin for the spread is $280. Suggested risk is $110. Initial projected objective is $110, then higher. Basis is seasonal (app. 10/20 – 11/15) and a Ross Hook. Comment: You can take the trade at the electronic market ICE. Please talk to your broker if this is your first time trading the ICE exchange.

Previous Trades:

Andy Jordan's Trading Bites

Emotional extremes
by Joe Ross

Many beginning traders undergo emotional extremes, feeling sheer ecstasy after a win, but crushing disappointment after a loss. However, as a mature trader, you grow to realize the folly of allowing the natural ups and downs of trading to impact your emotions that strongly.

Although as a winning professional trader you may stay calm and relaxed even after a series of losses, remaining rational and composed can be a challenge. It’s only natural to question your methods sometimes, and wonder about the validity of what you are doing. On the other hand, it’s also natural to get caught up in the euphoria of a winning streak and become complacent or even overconfident. You can be lulled into a false sense of security in your overconfidence, and become tempted to take unnecessary risks. Proper risk management is a must, and can help you to remain evenhanded by insuring a smooth, steadily rising equity curve.

It's important to realize that your trading performance moves in cycles, that sometimes you will be profitable and sometimes you won’t. Gaining awareness and acceptance of the fact that “sometimes you win, sometimes you lose” will help you to control your emotions; by trading in an optimal state of mind you increase your chances of achieving long-term financial success.

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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 24, 2007 - Volume 167 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. Andy's Spread Trading Example Previous Trades Andy Jordan's Trading Bites Start Your Trading Business on the Right Foot Contact Us 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.
Andy's Spread Scan Example: This week we look at KCH8 – KCZ7. Today we consider a calendar Coffee spread: long March 08 Coffee and short December 07 Coffee (KCH8 – KCZ7). The spread has been in an uptrend channel from the start. Is the breakout to the up side of the channel the starting point of the seasonal up move (app. 10/20 – 11/15)? Traders may want to enter the spread at a value of 4.00 or better. Initial margin for the spread is $280. Suggested risk is $110. Initial projected objective is $110, then higher. Basis is seasonal (app. 10/20 – 11/15) and a Ross Hook. Comment: You can take the trade at the electronic market ICE. Please talk to your broker if this is your first time trading the ICE exchange. back to top
Previous Trades: On September 16 we told subscribers of our professional daily spreads & position trading newsletter Traders Notebook, "Consider entering an calendar spread LHG8 – LHZ7 MOC on Monday. Initial margin for the spread is $675 (reduced margin). Suggested risk is $400. Initial projected objective is $400, then a move higher. Basis is seasonal (app. 9/26 – 11/8) and a Ross Hook." Here's how we suggested managing this trade: 09/17 In? 09/26 Spread hit first suggested target. Suggest moving stop to 4.225. 09/27 Suggest moving stop to 4.825. 09/28 Suggest moving stop to 4.85. 10/01 Suggest moving stop to 5.00. 10/02 Suggest moving stop to 5.575. 10/05 Suggest moving stop to 5.625. 10/08 Suggest moving stop to 5.700. 10/10 Suggest moving stop to 5.800. 10/16 Suggest moving stop to 5.900. 10/17 Suggest moving stop to 6.000. 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
Andy Jordan's Trading Bites Emotional extremes by Joe Ross Many beginning traders undergo emotional extremes, feeling sheer ecstasy after a win, but crushing disappointment after a loss. However, as a mature trader, you grow to realize the folly of allowing the natural ups and downs of trading to impact your emotions that strongly. Although as a winning professional trader you may stay calm and relaxed even after a series of losses, remaining rational and composed can be a challenge. It’s only natural to question your methods sometimes, and wonder about the validity of what you are doing. On the other hand, it’s also natural to get caught up in the euphoria of a winning streak and become complacent or even overconfident. You can be lulled into a false sense of security in your overconfidence, and become tempted to take unnecessary risks. Proper risk management is a must, and can help you to remain evenhanded by insuring a smooth, steadily rising equity curve. It's important to realize that your trading performance moves in cycles, that sometimes you will be profitable and sometimes you won’t. Gaining awareness and acceptance of the fact that “sometimes you win, sometimes you lose” will help you to control your emotions; by trading in an optimal state of mind you increase your chances of achieving long-term financial success. back to top
Start your Trading Business on the Right Foot Let me introduce you to a great online trading course you need to help you operate your trading business successfully in today's markets. Study it now, whether you are new to trading or an already seasoned trader. The course "From the Beginning" has information for traders at all levels, from beginners all the way through to advanced. The course includes fundamental detailed information about this business that most traders do not know, and are unaware that they need to know. IF YOU'RE LUCKY YOU MIGHT FIND THIS INFORMATION IN BOOKS, BUT you might have to read through thousands of pages to get it. However, in the e-book "From the Beginning," you will find the answers all in one place. You can increase your chances for trading success when you know and understand the business of trading. The more you know, the better off you will be. You need to know the rules and the players; you need to know what can hurt you and what can help you. Follow this link for more detailed information and to order YOUR COURSE "From the Beginning" NOW! All the best to you in your trading, Joe Ross
View last week's Spread Scan # 166 - October 17, 2007
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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!