Trading Educators Inc. - Joe Ross - Day Trading and Online Trading

Euro Chat with Joe Ross

Chat log from: Thursday, March 8, 2007

	joeross joined.
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joeross	Good evening to Europe
crosten	Joe, am I correct to say that the plunge team was very busy on the overnight session today?
sav	hello everyone
joeross	crosten: I don't know. I have not looked at the stock indexes today (after the chat I looked and it was almost certain the PPT was very active)
joeross	Hi sav
joeross	Hi Tin
RicketyTin	Hi Joe
crosten	Joe is there any correlation between gold and oil?
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nathan	Hi everyone
joeross	crosten: Indirectly, yes. If oil goes up causing inflation, then gold will tend to go up as well
joeross	Hi nathan
joeross	I didn't get a chance to look, but did the European Central Bank raise interest rates today?
crosten	Joe, did you take any trades today, if yes what were they?
joeross	That surprised me but maybe it accounts for the lack of movement here in the notes and bonds. Of course, they could be waiting for the big reports to come out tomorrow.
joeross	I am trading the Easy bond method today and I'm short bonds. Currently down -5/32nds
crosten	yes, they did raise interest rates
crosten	but the Bank of England did not raise
sav	raised it 25bps i think
nathan	bonds don´t want to go deeper than 112^30 last days
joeross	25 bps was what was expected. Didn't seem to affect anything over here
joeross	I didn't think BOE would raise.
nathan	was an easy bond entry today, though it's still in
joeross	maybe twice more by BOE later this year.
crosten	Joe, what is your hobby?
joeross	I'm still in. I think nothing much will happen until tomorrow. Friday is major reports in U.S.
joeross	crosten: I like to go fishing ;)
sav	non farm payroll tomorrow
nathan	coin fishing?
joeross	nathan: stop fishing
joeross	actually fishing for real fish is something I really like.
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joeross	Hi murra
crosten	Joe, do you trade on non farm payroll day? If yes, which market do you trade?
murra	hi Joe and everyone
nathan	sashimi right??
joeross	crosten: I will be looking for what will happen to the bonds. I like to trade bonds on major economic reports.
crosten	Joe, besides the U.S. is there a plunge team in other country ?
joeross	nathan: I like sashimi, yes, But it is terribly expensive in the U.S. Maybe less expensive in other places.
nathan	money is to spend, you can´t take it to your next life-- someone told me at least
joeross	crosten: I can't say for sure, but I would be surprised if there weren't PPTs in other countries
nathan	maybe it changed...
joeross	There's a great place in Munich where you can eat all you want for one price
murra	Are you in Munich, Joe?
crosten	I attended Jake Bernstein webinar yesterday, i asked him about the plunge team, he did not know about it .
crosten	Is the plunge team a national secret?
joeross	murra: I'm in Texas right now. In May I will be in Munich
joeross	crosten: it is not a secret anymore
crosten	which year did the plunge team began to operate?
joeross	crosten: 1987 after the crash
joeross	PPT stopped the crash but at that time it was only Goldman Sachs acting on behalf of the Treasury Dept.
crosten	Besides the S&P do the plunge team play on other market?
sav	Joe, do you think this PPT is a good thing or a bad thing?
joeross	crosten: none that I know of, but the banks have been manipulating gold for many years, pushing prices down..
joeross	But the first time they did it, they used the Major Market Maxi Index which doesn't exist any longer. Now they use the e-mini S&P 500
nathan	Joe, i found a method working with the next contract. Weekly based. If i switch a short time before delivery is there still a price difference from the current to the very next which makes a difference?
joeross	sav: PPT is very bad for traders, not so bad for letting the market down slowly. But in reality cheats us all.
crosten	Joe, it is correct to say that the plunge team lose money everytime they save the market ?
joeross	crosten: No I don't suspect any other market, but if the bond market began to crash I think they would try to stop it.
joeross	Nathan: it depends on which market. Which one do you mean?
nathan	ZG
crosten	The bond market will crash someday if china and japan began shifting to Europe
joeross	crosten: No. Just the opposite. They make money. They are buying low and selling higher.
joeross	nathan: Yes the difference will be the carrying charges.
joeross	nathan: you can look at the CBOT website to see what those are.
joeross	crosten: I agree. If foreign nations stop buying the U.S. debt, the debt market along with the dollar will crash.
nathan	thanks i will check it out at the CBOT
crosten	Joe, excluding the methods that you are selling, how many methods do you have in total ?
nathan	Does gold make more sense these days?
crosten	long gold
joeross	crosten: many more than I should. Sometimes it drives me crazy because we are unable to program them all
joeross	nathan: The gold market makes a lot of sense these days.
joeross	nathan: Especially if the Asians begin putting a lot of money into gold rather than U.S. Debt.
crosten	Give me a number joe,around how much.
nathan	do you think they will switch more to gold soon?
joeross	crosten: I don't have a number to give you, but I would guess over 50 methods.
joeross	nathan: I think they are already doing it. Asians value gold and they are buying it.
nathan	the decline in gold was quite big
crosten	Joe, what do you mean by program them? Are you referring to using indicator or something?
nathan	but there was a real rise in gold before
joeross	I made a big decision recently: Instead of being in gold as an investor, I would rather be in it as a trader.
nathan	intraday or higher time frame?
joeross	Nathan: gold has always been a rough ride. It swings up and down in huge swings. Very hard to invest in other than buy and hold for the long run. I prefer to day trade it and to position trade the swings.
joeross	I would not want to own physical gold at all. I think it is too dangerous.
nathan	why?
joeross	crosten: Not all methods are able to be easily programmed using the software I have. It has its limits.
crosten	Joe, if I email you can you share with me a simple method for trading currencies?
joeross	For example: the software does not allow me to move my stop during the current bar.
nathan	that makes programming very difficult
joeross	crosten: No
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joeross	crosten: you don't seem to understand that as much as we give things away, we also have a business to operate and salaries to pay. We can't give everything away for free
crosten	I read from mark mobious that should the dollar crash, the US government will cease your physical gold
crosten	the best way to own physical gold is to park it outside the US
joeross	crosten: The best way to own physical gold is to not own any.
joeross	What are you going to do with it? You can't spend it?
nathan	or keep gold deep in the mouth ::smile
joeross	If you could take it to the store and if they would accept it, 20 guys would follow you home to find out where you have the rest of it.
ian	Hi Everyone
joeross	Hi Ian
crosten	I mean Joe what i want is not a complete method, just an idea for something that I can work on and develop?
ian	Joe, if one has an account of 40 000, would you say it is being overly conservative to risk 250 per trade
joeross	crosten: My books are loaded with ideas. Why don't you try buying one ;)
crosten	I have them Joe, I just want an idea from you to trade the currency market
joeross	ian: I do not believe in risking fixed amounts. You need to fit the risk to the market. You can do that using volatility
crosten	to get me started
joeross	crosten: Take one of the many ideas from the books.
ian	Joe, can you expand a bit
joeross	crosten: One guy is making a lot of $$$ using the camelback technique in the currencies.
joeross	Another guy is cleaning up trading the cluster breakouts.
joeross	Another is winning using gimmee bars. You can find these guys posting in the forum.
joeross	ian: What i do is go back 30-40 days to see what would have worked in the market I want to trade. If the risk stop is not hit most of the time, then you know how much it should be. Let the market tell you where to put the stop.
crosten	there are quite a lot of fake cluster breakout in the currency.
ian	ok tks
murra	yes Joe, i am in agreement, all techniques if used correctly make money.
joeross	crosten: Then it is your job to learn what real breakouts look like or change your management to take advantage of the fake breakouts.
joeross	murra: You are correct. I can make money on just about anything that happens if I design my management around the way it happens.
crosten	esp the euro tons of stop running.
nathan	Joe, a stupid question, when i just buy and then sell a contract ZB when its still tradable, do i have to pay carrying charges?
joeross	I have said many times the following: Find something that happens often. Design your management around the event. See how many ticks you can make most of the time. See how much risk you need to take most of the time. Then trade enough contracts to make what you need to make and get out.
joeross	crosten: If you know what you are doing, you can take advantage of all the stop running
joeross	nathan: No you don't have to pay carrying charges. There are no costs of carry in the bonds.
murra	i am learning to use many of your technical methods, i think it is important to understand the fastness of market and then use the more appropriate management in that fastness and according it with your own personal comfort
joeross	nathan: you pay interest but that is already in the price
crosten	Joe, when developing a method, do you advise going from a smaller time frame to bigger time frame or bigger time frame to smaller time frame?
joeross	very good, murra, that's the way to do it.
joeross	I can already tell you will be a great trader.
joeross	Most people go about it all wrong.
joeross	that's why 90% lose
nathan	and because its a lot of work
nathan	to find out about yourself and the market
joeross	crosten: there is no answer for that question. You can do it either way as long as you are getting the right result.
joeross	nathan: Right on. It is work, but eventually you have seen so many things so often, you know immediately what to do.
crosten	Joe, how many years of data do you recommend to backtest a method?
nathan	I hope so
joeross	crosten: 2 years is plenty.
nathan	Depending on the time frame
joeross	nathan: Even though it is limited, it is very helpful to have software like Genesis Trade Navigator to help you do all the work.
murra	Joe, can i ask one question?
crosten	what is the power of Genesis, Joe?
joeross	murra: ask the question.
nathan	right if it can help it's helpful
joeross	crosten: it lets you backtest a couple of years of a strategy in a matter of seconds.
nathan	you just have to be sure that its testing what YOU want
crosten	Joe, when developing a method, do you start by looking at the price action or do you look at an indicator first ?
murra	I know is very important make back test to understand technique and method but when i have to prove a technique i prefer testing it without money on paper in the market is it wrong?
joeross	nathan: True, it must be helpful and test what you want. It also has its limitations. If the strategy is very complex, you can't do it with any of the known software. You have to write it yourself and attach it to the software you have.
nathan	And hope it works
joeross	crosten: forget indicators. they are only an afterthought. Look at price action.
crosten	Joe, when you say writing a strategy do you auto buy and sell signal?
nathan	Why does the gold market seem to be correlated to the dow in a way, these days?
joeross	murra: eventually you have to test with real money. That's correct, and that's what I'm doing right now.
joeross	crosten: in some cases yes, and others, no.
nathan	Did you change the parameters for easy bond?
crosten	Joe, the guys you mention using the camelback method, which currency is he using on? what time frame?
joeross	nathan: I don't know. I've heard a lot of stories about correlation. A broker once told me the snp was correlated to soybeans. Of course it might have been for a short time but not usually.
joeross	I can correlate the gold market to how many times I have to use the toilet, but that doesn't make much sense in the long term
nathan	...and life correlated to death at least for one time
joeross	nathan: no change in the parameters. Just trying a different management
joeross	crosten: I don't know
crosten	Joe can you give me the email of the person using the camel back?
joeross	crosten: I will not do that
murra	In my money management i include in every trade a bit part for the (i hope never) eventually future problem i now it is right but i ask is correct when calculate the percentage including it or is correct exclude it and add in cost?
crosten	Can you forward my question to the person then? I'll send you an email
joeross	murra: I would include it.
joeross	crosten: I respect the privacy of my students. I will never do such a thing. I wouldn't do it to you and I won't do it to them.
crosten	So you will not forward my email then?
joeross	crosten: I will not forward your email. I am not running a postal service here.
crosten	Joe besides genesis do you recommend other software for backtesting?
joeross	crosten: Genesis is the easiest to program. I don't know about other ones
joeross	You guys, I have to leave a couple of minutes early today. So I am going to sign off now
crosten	Joe the person using your camel back...
nathan	thanks for your service and help bye
crosten	Is he someone you personally mentored?
joeross	Next week I will be tied up with a student, and won't be able to do the chat on Thursday
nathan	see you
joeross	But I'll be back the following week
joeross	Happy trading to all
joeross	Tschüß
joeross	and Cheers
joeross	and Sayonara
joeross	or whatever else needs to be said
murra	thank you Joe and everyone

END OF CHAT

Next Chat with Joe Ross:
Thursday, March 22 , 2007
Time: 8:00 - 9:00 P.M., European Central Time (Berlin, Paris, Rome)

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