Chat Archives
Commodity Chat With Trader Jim! (tm) with Jim Prince
from 12/06/2006
Good evening everyone! Trader Jim here. . .
Thank you for joining me this evening. I'm very thrilled to be with you this evening. Numerous markets have been on fire this Holiday Season, so we have a lot to discuss this evening.
February Gold and March Silver continue to be very volatile. As do the December US Dollar Index, December Canadian Dollar, December Euro FX and the December British Pound. The Grains continue to be explosive too! If you've had a successful paper trade or real money trade in any of these markets (or other markets), please feel free to disclose your trade details with your fellow Course Members.
Chatting about your market experiences lets others know they are not alone in their trading adventures. So please share your excitement, enthusiasm, and zeal with your fellow Course Members. It provides others optimism!
I'd like send a great big “Thank You” to Ken Roberts. Ken first began introducing individuals to the World's Greatest Business over 20 years ago. I was fortunate enough to not only be a student of Ken's, but I also had the great pleasure to work for him for 12+ years. I'm happy to be able to share with you what I've learned over the years.
Make sure you take 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.
fix and fly paul asks (6:01:43 PM):
Jim: How do you access the archives of your weekly video lessons? I enjoyed the most recent one, but would like to review past lessons. Thanks.
Howdy fix and fly paul! The videos are free to all WGB Members and US Charts Online subscribers. You can find the video access link (in white text) at the top of the first page (after the disclaimer) once you're logged into US Charts Online. Enjoy!
teddyb asks (6:08:13 PM):
Hi TJ, TeddyB from SoFl here. About Strong 1 Strategy where the start is 'Days in Trent' = 1. I noticed when it forms TS Trend is neutral most of the times. How many days should we wait for the trend to change Up or Down. And then what sould Ranking be (Strong or Extreme) . Finally do you like this strategy?
Hi teddyb, Log into US Charts Online. Once there click on the Trend Seeker(tm) tab. Then find the fourth column from the left titled Days in Trend. You initiate the strategy the first day there is the number one in this column and the Trend Seeker Trend is either "Up" or "Down." We are not concerned with the Trend Signal Ranking for this strategy. Be sure to visit the Members area at www.wgbmembers.com. Once there, log in and then click on "Strategies." Be sure to check the example and all the details as explained in the write-up. Thanks for the question.
tony asks (6:12:55 PM):
what do you see on OJ?
This market is beating the bears to a pulp! Seriously though, the January contract made a new contract high today. In addition, it met the other criteria necessary to implement the Hi Lo Breakout strategy. Be sure to review all the details about this strategy at www.wgbmembers.com.
Full House From Phoe asks (6:16:49 PM):
What is a bull flag?
Hi Full House From Phoenix! A bull flag is a bullish chart pattern. The rise to the flag is considered the "flag pole." The flag is nothing more than prices consolidating in a sideways or slanted channel. Be sure to look in the Chart Book and locate the charts for both March Oats and March Wheat. Both charts have all the details marked on them as well as when to paper trade the individual market.
wes asks (6:20:41 PM):
wes from Ashburn would like to know what does one do to be a WGB member? And since I buy the paper charts can I log in to US Charts Online?
Hey wes from Ashburn! The paper charts are a separate subscription from all the material we have online. But call a Course Counselor and ask about our "trial" offer for our online services. They'll be happy to help you. The Course Counselors can be reached Monday through Friday from 8:30am to 5:00pm PT at 541-955-2885.
mrbaxtor asks (6:26:12 PM):
Hey Jim, I finally started trading more than one option per contract, what a ride when you more on, peeling off profits and staying in the market, i love it. I made some nice money in Jan SB. It consilidated, then moved up. How could we have gotten in during the initial move up, seems like ts did not alert us quick enough, any suggestions?
Hi mrbaxtor! When you say "Jan SB" I'm assuming you mean January Soybeans. There was a small 1-2-3 bottom formation that took shape but TS didn't confirm the trend change when price broke above the #2 point. So the next thing to consider was to watch and wait for a pull back to the #2 point. This didn't happen. So based on the methods we teach we missed the initial move up. However, we did have a beautiful entry signal based on the Hi Lo Breakout strategy. Remember, there is no strategy that is going to catch every single move in the markets. We have a methodology and be sticking to our rules we can do pretty good. (As per signals in Corn, Oats, Meal, and Wheat.)
Dave C., Natick asks (6:29:46 PM):
"Ken's Chart Book" is no longer Ken's. Jim, can't we organize it so it makes sense to subscribers in the the "Top Down" tradition? "History" means nothing. "Weekly History" makes sense. Any thoughts?
Hi Dave! That's exactly what will be available within the new chart site. In fact, now that I mention the new chart site I should tell you that we plan to launch it sometime next week. You'll be getting an email notifying you of the exact date. You'll have access to both the "old" site and the "new" one for as long as you need. Anyway, I'm real excited about the new US Charts web site. We've shown the beta version to Trading Camp attendees and they all have loved it. I'm sure you'll love it too!
Jared of Idaho asks (6:32:08 PM):
Jan heating oil formed a 123 bottom formation breaking above the number 3 point a few days ago. It has since pulled pack near the #3 point. Is this to big of a pull back or is it still ok to enter a trade with a call option?
Hi Jared of Idaho, Many times a pull back to the #2 point offers a nice entry opportunity if the initial breakout was missed. The reason is because the #2 point is now support! This is a great opportunity for you to paper trade this market and setup. Let me know how it works out for you. Good question!
rick asks (6:35:29 PM):
hi Jim, I noticed on the daily soybean oil chart that there has been a nice uptrend for the last 40 or so days, but the open interest and volume have been steadily decreasing. Is there any significane there?
Howdy rick! Yep, First Notice Day (FND) is December 29 so all long positions have to be out before that day. The volume will typically move over to the March contract. I'm not real sure that the move has begun quite yet because we still have a bit of time before FND. In addition, we watch Trend Seeker. The front month contract is always listed and will always be the one with the most volume and open interest.
JER asks (6:37:54 PM):
My question is how do I get in the chat--so far I can't get beyond this question.
JER, you're in the chat my friend. Just click the "refresh" button at the bottom of the page. Welcome and thanks for joining us tonight!
sxt102 asks (6:41:00 PM):
Jim: I have been watching April lean hogs have a 1-2-3 top formation the #1 point 70.15 the high on 11-8-06 the #2 point is 66.00 the low on 11-15-06 and the #3 point is 69.50 11-24-06 an ts is down. what do you think?
Well sxt102. . . based on the above information, and what I see on the chart, and the fact that prices have broken and are sitting at a level equal to the #2 point, a paper trade with put options could be in order. Good eye!
mrbaxtor asks (6:42:14 PM):
Is there any markets which may becoming liquid enough to list and follow on USC. Anything new on the horizons?
Not that I'm aware of mrbaxtor. We cover a boat load of markets at US Charts. Personally it's more than enough to keep me busy.
DeeBeeTx asks (6:45:58 PM):
Evening Jim and all, when option premiums close to the breakout are too pricey, is it better to buy options further away from the breakout point or to not trade this market and wait for another opportunity? Thanks for sharing your expertise with novices like me. You are a wonderful teacher.
Hi DeeBeeTx! Thanks for the kind words. If an at or near-the-money option is too expensive then I encourage you to paper trade an option that you can afford. See what happens, make note of the price action and premium action and keep a log book of it. Do this over and over. Eventually you'll see whether it works for you or not. I would definitely paper trade this scenario and see if it's right for you. Good question.
jowana asks (6:47:03 PM):
Good evening all just a note I was able to make $1800 on a mar/07 corn call (270). Very very happy.
Nice job, jowana! And thanks for passing the info a long to fellow Course Members. Keep on keepin' on!
Ed in Windsor. Ontar asks (6:51:06 PM):
Hi Jim: Is the new Premium Alert Service in operation now? When I click on the Play button, nothing happens. I downloaded the player as suggested and still nothing happens.
Howdy Ed in Windsor. Ontario! Good question. . . it's not available quite yet. In fact, we should be launching the Premium Alert Service (PAS) either next week or the week after. Just be sure to check the www.wgbmembers.com web site if you don't happen to receive an email. If you like the free weekly online video trading lessons then the Premium Alert Service is going to blow you away! We are very excited about launching this new service. Stay tuned!
rick asks (6:55:05 PM):
I have been trying to find an effective method for setting a target low or high in wich to exit a trade and set realistic risk/reward ratios, any suggestions?
Hi rick, Yes, go to US Charts Online and and watch the free weekly training video I did on this subject. You can find the video access link (in white text) at the top of the first page (after the disclaimer) once you're logged into US Charts Online. Once there, locate the video dated 11/17/06. The video is 13 minutes in length and talks about setting profit targets in detail. Enjoy!
topprofit asks (6:58:47 PM):
Jim: According to Ken the Dow may be heading to 14,000 plus per the poor man's configuration. What do you think?
Hi topprofit. . . If you're referring to the Head and Shoulders pattern that is on the Monthly chart of the Dow, then you should know that it's not Ken who said that, it's me! I'm the one that updates the Chart Book. And yes, that is and has been my long-term target for many, many months. Thanks for the question tonight.
JER asks (7:03:50 PM):
I would be interested in being able to follow someone else's lead--someone that has established a very good track record. I have been timid about jumping in.
JER. . . to me that means you're not ready to trade with real money. If you're a WGB Member then you have all you need to learn how to trade the World's Greatest Business! So I encourage you to paper trade and then paper trade some more. Ken used to say that you'll know when you're ready to begin trading with real money when you get tired of making money paper trading. You have to have a solid plan in place and know exactly where to enter the market, place stops, and take profits. If you do you'll be way ahead in this business. So to really learn to work these things you need to paper trade.
calplants asks (7:04:53 PM):
Has any one reported that some weekly videos from Trader Jim work okay and others do not?Thanks.
Not that I'm aware of calplants! You might call a Course Counselor though and let them know about your challenge.
eddy asks (7:11:36 PM):
Hi Jim, In reguards to "Here's what just Happened" on Gold the other day, what is your exit strategy if the market drops. Thanks
Hi eddy! I always trail a stop loss, always! I have a stop in place at entry and if the market moves in my favor I trail it. In other words, I move it up to help protect any accumulating profits. This is something all traders should do. I can't emphasize this enough. Folks tend to think the market will go straight to the moon and never pull back. Gold proved today that that just isn't the case! So always trail a stop. You can do it below (above) support/resistance levels, a certain dollar or percentage away from current prices or whatever meets your fancy. Watch the training video I did that's dated 11/10/06. It's 11 minutes of nothing but "trailing stop losses."
Bill in NC asks (7:14:52 PM):
Hi Jim, You are having some nasty weather out there! Over the past twenty years has inflation had any effect on the charts? If so, how?
Hi Bill in NC! Do you mean in regards to the cost of the paper and ink to print the paper copies? Seriously, take a "deep" look at your charts. Notice how the markets cycle. A few years ago (2003) sugar was at a price that Abraham Lincoln paid. That's just one example but you can find others as you scour your charts. So, my short answer is no. Markets cycle just like everything else.
observer asks (7:24:42 PM):
observerHi Jim: I have recently started paper trading again after having been away for about a year and a half. As a course member, I have checked out all that comes down the computer “pike”, and I really like your weekly videos, they are great and very helpful. There are some new terms such as pennant and triangle formations, which are pretty easy to figure out, but what is a “bull flag” formation? Perhaps this and how to easily arrive at a strike price, I would like to suggest for one of your weekly videos. Also I have not heard you ever mentioning the 50% retracement rule, has it fallen out of favor, but Ken just recently made a DVD of the subject? And has TS replaced TOVI, because Ken is no longer involved with TOVI? Thanks for everything.
Hey there observer. . . Thanks for the nice words, they are greatly appreciated. There have been several that have ask about the "bull flag" formation to perhaps I'll do a video on it shortly. Look at the charts in the Chart Book of March Oats and March Wheat. They have pretty good examples outlined. I've actually done several videos about options. In particular you'll want to watch the video dated 8/25/06. Find that one in the archive and you'll be in business. I've done videos about the 50% level too and will also place it on the charts in the chart book. It hasn't fallen by the wayside. Trend Seeker (TS) is our own product, and one that we feel completely fits the bill for what we do here at US Charts.
bdw in texas asks (7:28:38 PM):
Hi Jim, Seasons Greetings, Do you trade only options? What about futures? What circumstances would cause you to trade a future instead of an option in a market ?
Hi bdw in texas, I learned to trade by trading futures contracts. In fact, most all of my trading is with futures contracts. That said, over the years I have traded a boat load of options. Personally I prefer futures, however, and that's probably because they are what I cut my teeth on. However, options offer every bit the opportunity. The bottom line is, which ever vehicle is used really depends on the individual trader and what he/she is most comfortable using.
ChampaignChad asks (7:33:24 PM):
Jim, March Cotton formed a 123 bottom. It broke the 2 and is now testing the 2 as support. With it being so close to the 50% level, is this a good market to look at trading. There is room for profit. I am paper trading this, so I will learn from it. I just wanted a "seasoned" opinion. Thanks
Hi ChampaignChad! I don't see a 1-2-3 bottom in place quite yet. I see the #1 point at 50.81 (on 1/20/06. The #2 point is the high at 54.10 (on 12/01/06). To me, this market is still waiting to form a #3 point. But.......... you are right about the 50% level being close to the #2 point. Should you trade it? Only you can answer that. There's a potential for a great education here. I encourage you to paper trade the formation once it takes shape. Thanks for the question.
Dave C., Natick asks (7:36:17 PM):
WGB Friday update? I've been missing the strategy updates. Will we have something new soon?
Hey Dave C. Natick, the WGB Friday Updates are sent out each and every Friday to current Course Members. If you're not getting it be sure to call a Course Counselor and make sure we have your correct email address. In the meantime, you can always access the updates by going to www.wgbmembers.com. Once there, log in and then click on the Mailbox. The update is listed in the mailbox. Thanks!
tradetracker asks (7:40:07 PM):
Hi Jim. Please explain the why and wherefore of your decision not to trade the March Cotton #2 formation. I think this market is about to explode. Thanks.
Hi tradetracker! I trade chart patterns and at this point in time I don't see a chart pattern in place. So I'll wait for one to materialize. It may explode but I learned long ago that my opinion about a market is worthless. So instead of trying to force my "belief" on the market, I let the market tell me what to do. I do this by trading the various patterns. In other words, I try to trade what I see is happening instead of what I think is happening.
inthe$ asks (7:42:55 PM):
Are there any markets or strategies that you tend to shy away from? Or that you prefer to enter into?
Hi inthe$, yes there are some markets that I don't trade. But I'm not going to reveal them here simply because I don't want others "not" to give them the old college try. I will however say this. . . I tend to shy away from thinly traded markets or what I consider overly volatile markets. Hope this helps.
ChampaignChad asks (7:45:45 PM):
Jim, Could you please explain "gaps" in the market. March Lumber gapped out of its channel. My gut reaction is to wait and see. Especially with such a volitale market.
A gap is simply an "empty" or "blank" space on the chart between two different days price activity. For example, if Lumber closed at 220.00 (which was also the high of the day) and the following day prices opened at 225.00 (which was the low of the day). There would be a gap on the chart between 220.00 and 225.00. This means there was more demand than supply, e.g. more buyers than sellers.
Starla asks (7:49:19 PM):
I have recently come back to WGB and am trying to learn all of the new teachings. I wondered if you have any advice on developing a daily rountine on how you review all of the markets that you are following ex- custom quotes- charts- trend seeker- trade tracker. I'm struggling to develop a routine. I am looking forward to coming out to one of the trading camps but after recent events I think I'll wait to venture out that way until weather is better.
Hi Starla, Yes I do have a method or routine that I think is a quality time saver. I teach this method at the Trading Camps too. Unfortunately it would take too long for me to describe here. But I tell you what. . . I'll do a video on a "shortened version" about this topic. Look for it in the next two or three editions.
Emery asks (7:53:37 PM):
Hi Jim,Unfortunately Broadband service is not available to me in my location. My dial-up fastest hookup is 54.6 kbps. This does not allow me to receive streaming info. Am I overlooking some workaround? Is it feasable that you could make these very valuable learning tools available in a format that could be downloaded and saved so that they could be utilized by those of us trapped in predawn internet speed zones?
Hi Emery! Yes, we are aware that this is a challenge for some Course Members. Let it be known that we are working on a fix. Hopefully we'll have it available for you soon. That said, I live in the "backwoods" and don't have access to cable or dsl. So I opted to get my home internet via satellite. I've had it for several years and it works great!
JER asks (7:54:08 PM):
When I started with WGB in Oct. , I paper started with Mar. Corn like jowana and would have made a profit around $1800 also. Not sure my wife believed me, so am glad that jowana did report the profit.
Sounds like you're on the right track! Keep up the good work!
Mike in NYC asks (7:58:24 PM):
How about listing the new Ethanol market on the Chicago Board of Trade. The only negative is the Open Interest is very small. Would you wait until the market is more liquid to list on US Charts?
I'll pass your wishes a long. But, like I said earlier this evening there are a ton of markets already contained within US Charts --- more than enough to keep me busy. I'll share a bit with you here. . . many folks wonder how they can participate in trading the stock market. They don't even realize there are mini contracts on the Dow Jones, the S&P 500, the Russell 2000, or the NASDAQ. I trade the Dow mini all the time. In fact, it's one of my favorite markets. It's heavily traded and has great movement. Something to think about if you're one of those folks that wishes to participate in the stock market but didn't know how.
Bonita Joe asks (8:03:56 PM):
Dear Jim "Karnack" Prince, Bonita Joe here sitting by my fireplace contemplating coffee. I have March Calls @ 115 (mostly) and some at 140. When coffee went past the resistance on the Monthly, Weekly, and Daily charts I started another fire! When coffee retraced this week I went out to May and managed to get several 135 CALLS. Now, my question is....is the next hurdle the daily chart high, which just so happens to be close to where coffee is right now, or do I look at the fact that the major resistance was broken and the upside is the "possible" goal, with stops in place???? Is that all one sentence,,,,whew???
Whewwwwwwwwwww that was a long one, Bonita Joe. I actually drank three cups of coffee while reading it! For me the next upside target would be the Daily chart highs at 136.50 -- which also happens to be the Weekly chart highs. Of course always keep your stops in place. You never know when a market will reverse on a dime (like Gold did today).
Tre-Tre from Toronto asks (8:06:08 PM):
Jim I'm late today thanks for all you do and I look forward to the workshop and the computer chat next month, see you later.
Thanks for stopping by again Tre-Tre. As always it's great to see you here.
bdw in texas asks (8:12:30 PM):
Do most markets go thru periods of being thinly traded or overly volatile ? How do tell if a market is being thinly traded ?
Markets go through periods of what Ted Warren called "quietness" and then the become volatile. The price action cycles just like the seasons. You can tell if a market is thinly traded by check the volume on the charts. Visit the Interactive charts at US Chart and then click on the volume at the bottom of the chart. The volume will display in the window under your mouse. . . Example of a thinly trade market would be January Lumber. Its volume on Tuesday, Dec. 5 was 898. Volume for March Corn on Dec. 5 was 47,825 -- which is considered a heavily traded market. Hope this helps.
Investolator asks (8:13:14 PM):
Jim, how much time do you consider it to be,a short term or long term trade.
To me, short-term is under three months. Long-term, of course, would be over three months.
Dave C., Natick asks (8:15:31 PM):
OK, I get it. We can't refer to actual trades, only "paper trades." No problem.
Hey Dave, I'm not sure what you mean. . . I encourage you to chat about whatever you like. If you want to discuss real money or paper trades, you are more than welcome.
Malachi 3:6-12 asks (8:18:45 PM):
Hi Jim,Thank you for all your insight and assistance.
Malachi 3:6-12, you are more than welcome. It's actually a lot of fun teaching and sharing what I've been able to learn during the many years I've been at this. Over the years I've met so many nice people from all walks of life, it truly is my pleasure. I'm honored and feel very blessed to have this opportunity to work with all you folks.
b0bby.c asks (8:25:59 PM):
bobby.c calif in feb gold near stop do you see strong suport near todays close ? numbers please do you use hi or close for suport
Hi b0bby.c, I see strong support at roughly 621.00. When I'm locating support or resistance levels I usually use the high or low. However, I'm not adverse to drawing trend lines for support/resistance and connecting the opens, highs, lows, or closes. I encourage you to take a peek at two videos I did last summer about identifying support and resistance. The videos are available in the archives at US Charts Online. You can find the video access link (in white text) at the top of the first page (after the disclaimer) once you're logged into US Charts Online. Once there, locate the 7/28/06 and 8/04/06 videos. Have fun!
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 lessons at: US Charts Online. This is a fantastic teaching tool and free to all WGB Members and 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!
Have a very Merry Christmas and a Happy New Year!
My next chat will be on Tuesday, January 9, 2007. God Bless and I look forward to seeing you then!
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