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Spread Scan Issue: June 17, 2009 - Volume 251
Welcome to this week’s issue of the Joe Ross Spread Trading Newsletter. The Spread Scan weekly newsletter is designed to assist you in becoming a better, more complete trader by showing you, within the context of the markets, how to trade spreads.
In this newsletter you will see applications of spreading in the futures and commodity markets. Spreads are applicable to all futures markets including currencies, commodities, financial instruments, and stock indexes. It is even possible to trade spreads in the all-electronic intraday market using day trading techniques.
Spreads are based on seasonality, correlation, backwardation, chart patterns, and simple observation. Spreads follow the Law of Charts™ and can be implemented using the Traders Trick™ entry.
In each issue of Spread Scan, you will find an upcoming spread trade for your consideration in the following week. You will also find a review of an existing or closed spread so you can see and learn how spread trades are managed.
Spreads offer you the most efficient use of your margin account of any other way to trade. Many traders find they like them so much that spreading becomes their primary way of trading.
Each week we present spread trading examples and opportunities to help you become a more professional spread trader, and we provide you with helpful content of interest to traders:
Be sure to "white list" us to ensure that you receive all your issues of Spread Scan. That way you can continue to enjoy learning through the best free educational trading information available, and we can keep you informed about additional trading techniques, educational services and products to help you grow as a successful and profitable spread trader.
This week we look at CK0 – CZ9: long May '10 Corn and short December '09 Corn (ECBOT)
Today we consider a Corn calendar spread (ECBOT): long May '10 Corn and short December '09 Corn (CK0 – CZ9). The spread has been trading in a range between 16 ½ and 21 ½. After testing the March low at 16 ½ once again in May, the spread might be ready to move higher. The low at 16 ½ seems to be a logical level for the initial stop. I would recommend a limit order for the entry due to low volume of the spread.
Traders may want to enter the spread at 19 limit. Initial margin is $68 (reduced). Suggested risk is $200. Initial projected objective is $200, then a move to 25 or higher. Basis is seasonal (6/13 – 9/19) and a Ross Hook.
On April 13 we told subscribers of our professional daily spreads & position/swing trading newsletter Traders Notebook, "Consider entering a Bean Oil calendar spread BOZ9 – BON9 (ECBOT) at 0.80 limit. Initial margin is $203 (reduced). Suggested risk is $100; initial projected objective is $100, then a move higher. Basis is seasonal (4/29 – 6/29). Comment: It looks like the spread could stabilize around 0.75 and is now ready to start its seasonal move. Because of the low risk, this spread is mainly for the ones with a small account."
Here's how we suggested managing this trade:
04/14 It was possible to get in at 0.80. Suggested mental stop at 0.66.
04/24 It seems there is resistance around 0.73 and the spread is on its way now.
05/28 Suggested mental stop on close at 0.70. Suggest cashing in the first lot at 0.90.
06/01 Suggested mental stop on close at 0.72.
06/09 Suggested mental stop on close at 0.82.
06/11 It was possible to cash in the first lot at 0.88 (see email).
06/12 Suggested mental stop on close at 0.85.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
Achieving Self Esteem
by Joe RossThe single most important component of the personality related to personal achievement is self esteem. Self esteem is simply how much an individual likes himself, and it correlates with high achievement on a one-to-one basis. The more an individual likes himself, the higher levels of performance he can achieve in any area of his life. A trader should always have at least one physical or mental activity every week, like chess or golf, that helps him feel good about himself. After a trader takes a loss or makes a mistake, he should consider going to a mirror, looking himself in the eye, and repeating the phrase, “I like myself,” with intensity, at least five times. This should boost the trader's self esteem despite his losses, assuming he committed no trading system discipline violations. (For violations he needs to forgive himself and start over.)
Understanding the three components of the self-concept is beneficial for reaching high performance and personal achievement. The Ideal Self is a mental picture of the trader a person would like to become, a composite of all the positive qualities admired in other traders. Schwager's “Market Wizards” is filled with these admirable characters with their winning personalities. The Self Image is the inner mirror of the person a trader thinks he really is, and relates to how he interacts with others on a day-to-day basis. A person seldom reaches levels of achievement beyond his self image limitations. Self Esteem is how much a person likes himself. The more a person likes himself, the higher the levels of achievement that are possible. These three components of the personality are constantly changing. The self-aware trader shapes these personality components to compliment his goal-achieving efforts to trade the markets profitably.
The Best Trading Teacher You'll Ever Have |
LET YOUR EYES BE OPENED BY JOE ROSS, AND LET HIM GUIDE YOU INTO BECOMING ALL YOU WANT TO BE IN TRADING THE MARKETS
It has always amazed us that normally astute professional individuals and business people will embark on a course as serious as trading and not seek professional help. Thousands who enter the field of trading try to figure it out for themselves, and they end up losing far more money trading from ignorance than the cost of our training. People spend thousands of hours and dollars in a vain attempt to go it on their own. No one is beyond the need for professional help when it comes to futures trading. Even professional traders come to Joe for help and additional training. Let him help you as well.
"Fantastic knowledge! Joe showed me simple, easy way to understand and trade the market. l learned how it works and how to take advantage of it. Now when I look at the chart I can actually understand what l see. Sometimes simplicity is hardest thing to achieve . Joe certainly did it. Make a good investment and learn from the master. For me it was worth every penny." -- Bogdan Podkulski - USA / NJ
"My trading has improved dramatically since I had my private training with Joe. All aspects necessary to become a successful trader were covered in detail: entry techniques, trade management, and money management. Joe has shown me how to take high probability trades with limited risk, which has made my trading much more profitable and enjoyable." -- William Hove, WI, U.S.A.
"I thank Joe Ross from the bottom of my heart because he has show me how to make a living trading, using the Internet for our private lesson. He has reconstructed my self-image as a losing trader, and has shown me the correct mind set and attitude necessary for trading in the markets without fear or insecurity. I have learned how to take profits and manage stops using a method I didn’t previously know. Besides the private online tutoring, Joe gives me continuing support via email every day that I have a need. Now, my trading is working, and I am very selective in the trades I take. I look for only the best trades for me, as Joe taught me to do. My sincerest thanks and greatest respect!!!" -- Gianluca Masia, Italy
"It was an honor to study under Joe. He's very personable and humble. I was quite nervous about studying under such a renowned Master Trader, but his humility put me at ease. Joe's approach is simple, yet profound. He takes the confusion out of chart reading and opens your eyes to what's really taking place in the markets. He puts it all into focus, instilling in you the confidence to take a trade. I've taken a number of courses from what I would now refer to as Master Scammers in the forex market. None of them were able to give me what Joe gave me: the confidence to trade. I believe this is the greatest gift a teacher can impart to his student. This gift alone is worth far more than the price of the course. Thanks, Joe! I was once blind, but now I see."-- Christopher Holm, Japan
Reserve your training session fast! Joe's teaching time is limited!
All sessions last as many days as your wants and needs dictate (most are for three days), and are taught near Austin, Texas, U.S.A. with Joe Ross in person OR if you prefer, Joe can train you online via Internet.
Don't hesitate too long if you want to be taught by a professional and successful long-time trader. Joe reserves only a certain number of days each month for personal teaching time, and the openings on his calendar for private teaching are booked fast, so you need to plan well in advance.
Visit Joe's website at Trading Educators to find out more about the private tutoring and to schedule your own training with him..
FRESH PERSPECTIVES - Ready for YOUR active participation.
Joe's live chats are an incomparable service from Trading Educators. The chats encourage forward-thinking, and inspire others by what is shared. Gather up your questions and comments, and "meet" other traders on line. Joe Ross will answer everything he can - come and join either his U.S. Live Chat or his Euro Live Chat:
U.S. Live Chats for June 2009:
Wednesday, June 24, 2009
We hope you will join us!
Here
is where you login to Joe's Wednesday Chat
You can also view our saved weekly Chat Logs in case
you missed any Chats but want to be up-to-date
European Chats for June 2009:
Wednesday, June 24, 2009
We hope you will join us!
Here is where you login to Joe's Euro Chat
You can also view our saved weekly Chat Logs in case
you missed any Chats but want to be up-to-date.
ABOUT JOE ROSS:
Joe Ross has been trading and investing since his first trade at the age of 14, and is a well known Master Trader and Investor. He has survived all the up and downs of the markets because of his adaptable trading style, using a low-risk approach that produces consistent profits. Joe Ross is the discoverer of the Ross hook(TM), and has set new standards for low-risk trading with his concepts of The Law of Charts(TM) and the Traders Trick Entry(TM). Joe was a private trader and investor for much of his life, but a serious health situation in the late 1980's caused him to shift his focus, and that is when he decided to share his knowledge. After his recovery, he founded Trading Educators in 1988, to teach aspiring traders how to make profits using his approaches to trading. Joe Ross has written twelve major books and countless articles and essays about trading. All his books have become classics, and have been translated into various languages. His students from around the world number in the thousands. His file of letters containing thanks and appreciation from students on every continent (now including Antarctica) is huge. As one student, a successful trader, wrote: "Thanks again for your trust and patience...Joe is a fountain of knowledge...but it is his wisdom that really sets him apart." Joe Ross holds a Bachelor of Science degree in Business Administration from the University of California at Los Angeles. He did his Masters work in Computer Sciences at the George Washington University extension in Norfolk, Virginia. He is listed in "Who's Who in America." After 5 decades of trading and investing, Joe Ross still tutors, teaches, writes, and trades regularly. Joe is an active and integral part of Trading Educators. He is the primary author and Editor-in-Chief of the company's newsletters: Chart Scan(TM), Spread Scan(TM) , Traders Money Club™ and Traders Notebook(TM). He is also the host of the free Traders Live Chat, the free European Chat for Traders, and the moderator of his popular trading forum. |
Joe's philosophy for helping traders is:"Teach our students the truth in trading — teach them how to trade. Give them a way to earn while they learn, realizing that it takes time to develop a successful trader."
Joe sets forth the mission of Trading Educators as follows:
- To show aspiring futures traders the truth in trading by teaching them how to read a chart so that they can successfully trade what they see, and by revealing to them all of the insider knowledge they need in order to understand the markets.
- To enable them to trade profitably by training them to properly manage their trades as well as their mindset and self-control.
For information about Joe Ross and Trading Educators,
please follow this link...
ABOUT ANDY JORDAN:
Educator
for Spread Trading and
Editor of Traders Notebook & Spread Scan Andy
Jordan made his first option trade at the age of 18. Since then
he has been fascinated by the world of trading. In 2002 he met
Joe Ross, and became interested in spread trading. Andy was
then intensively tutored by Joe Ross and personnel at Trading
Educators. Andy is the founder and president of Jordan Trading, S. A. Even though Andy has shown through live chats and in several
trading journals that he is able to day trade today's markets,
spread trading has always been his favorite. In
addition to his own spread trading activities, Andy is the editor
of Traders
Notebook. For those interested in one-on-one personal coaching,
Andy has developed and instructs an online course in spread trading, "Trading Mentoring - Trade with
a Pro," during which he demonstrates all aspects
of trading from choosing the trades on through how and when
to enter the trades, manage the trades, and exit the trades.
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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!