Edition 1023
April 12, 2024
Learn the Art of Trading Joe Ross' Way!
"No market is perfect until you fall in love with it. But then, watch out. The markets are a fickle lover." -- Master Trader Joe Ross
Master Trader Joe Ross
Author, Trader, Trading Mentor, and Founder of Trading Educators, Inc.
Developer of Instant Income Guaranteed
Chart Scan with Commentary: What Is Containment? Part 4
Containment with Bollinger Bands attempts to show trend containment most likely began with moving average bands.
Traders would take a moving average of the highs and a moving average of the lows, and plot them to show containment of a trend. The problem was "How many bars should you use for the moving average?" A lesser problem developed as to which kind of moving average to use: Simple, Exponential, somehow weighted, or displaced — which? Did it matter? Not really. The accuracy, if any, came from choosing the correct number of bars (candles) to include in the moving average.
Someone got the brilliant idea to use the number of bars in a commodity’s cycle — whatever that was. However, if the cycle was too long, then it became popular to use the commodity’s halfcycle. Let’s face it, these were nothing more than guesses And what about things that weren’t commodities, things for which finding a cycle could be extremely difficult? Were currencies cyclical? Were stocks and bonds cyclical? Did anyone really know? Do stocks have cycles? Maybe sectors have cycles. Would a natural gas cycle be the same as a crude oil cycle? I’ll leave such decisions to scientists and mathematicians to figure out. While they are figuring it out, I’d rather figure out how to take money from the markets.
An improvement was definitely needed, and sure enough one came along. The Keltner Channel is one of the attempts to improve containment. Instead of using moving averages of the highs and lows, Keltner decided to take a moving average of the closes, and then place the bands at a certain percentage distant from the moving average. Again, it didn’t much matter which kind of moving average was used. The problem with Keltner channels is which percentage to use. Should the bands be located 10% above and below the moving average? What about 20%; 30%; or should we simply guess by trial and error?
I am not telling you any of this in order to disparage or make fun of these attempts to show containment. I won’t even make fun of Andrews’ Pitchfork. Believe me, I used and tried them all. I made money with them, as well. But most of what I made was due to learning how to trade; learning how the markets worked; discovering the Law of Charts, and Market Dynamics.
Sometime back in the 1980s, before it was bought out by CNBC, there was a TV station called FNN (Financial News Network). One of the regulars was a fellow by the name of John Bollinger. I don’t know if it was coincidence, but at the time CNBC took over FNN, I no longer saw Bollinger. But shortly thereafter, I heard about Bollinger Bands. I examined them, and discovered the most intelligent way to use a moving average I have seen so far. Bollinger’s idea was to allow market volatility to decide the distance the bands should be from the moving average. Bollinger’s bands use Standard Deviation to set the distance of the bands from the moving average. The original weakness is still there. That weakness is how many bars (candles) to use for the moving average, along with the lesser problem of which kind of moving average to use. Nevertheless, Bollinger Bands make more sense than anything else I’ve seen in all my years of trading. My hat is off to John Bollinger!
I have always used Bollinger Bands in the plain vanilla way that they are presented in the software I use: an 18-bar simple moving average of the close, with the bands set at 2 Standard Deviations from the moving average. I work around any weaknesses rather than trying to tweak any of the settings to create a best fit, or optimize results in any way.
Notice that when prices are falling, the trend line is the lower band, which hugs the closes. With falling prices, the band most distant from the closes is the volatility band. Conversely, when prices are rising, the trend line becomes the upper band, and the lower band shows volatility. The bands expand and contract as volatility changes. We are looking at a chart of the Dow futures. How to trade with the bands is the subject of one of my mini seminars, "Trading with More Special Setups."
© by Joe Ross, first release 2014. Re-transmission or production of any part of this material is strictly prohibited without the prior written consent of Trading Educators, Inc.
Master Trader Joe Ross
Author, Trader, Trading Mentor, and Founder of Trading Educators, Inc.
Developer of Instant Income Guaranteed
Trading Article: Controlling Impulses
When it comes to protecting your money, one of the biggest dangers is so-called impulse trading. Resisting the urge to have something right then and there is a skill everyone needs to learn in order to build a strong...read more.
© by Joe Ross first release 2005. Re-transmission or reproduction of any part of this material is strictly prohibited without the prior written consent of Trading Educators, Inc.
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Trading with MORE Special Set-Ups
This newsletter and future publications are created to keep Master Trader Joe Ross' lessons readily available to traders that want to learn and improve their skills and to show his written word is still very relevant in today's trading world. He passed away on September 7, 2021 and will be greatly missed, but his writings will stand the test of time for generations to come. Take it to heart and learn from the best through Joe Ross' trading examples and articles which have impacted thousands of traders on every continent for over 60 years. Enjoy and let's start learning the art of trading Joe Ross' way.
Professional Trader Andy Jordan
Educator for Spreads, Options, Swing, and Day Trading, and Editor for 20+ years with Traders Notebook, daily advisory newsletter.
Forge Your Path in Options Trading
This is an opportune time to re-calibrate our strategies in the options market. Don't just follow trends, but to understand and apply a strategic approach that aligns with your goals.
Reflecting on past performance, like the growth trajectory represented in my trading graph, provides valuable insights. These results, marked by a commendable win/loss ratio and net profits, illustrate the potential of a disciplined approach. Yet, it’s crucial to remember that past results are not necessarily indicative of future performance. Every year is a new chapter in the market’s story, and 2024 is no exception.
With that in mind, my mentorship program is designed to equip you with the tools and mindset for making informed decisions, grounded in a methodology that has been refined over time. In a year where many traders are seeking direction, I offer the lessons drawn from experience to help chart a course that’s uniquely yours.
As we look ahead, let's collaborate to develop a strategy that takes into account the lessons from the past while forging ahead with fresh, educated trades. Your journey through the options market this year can begin with a conversation about where you are, where you want to be, and how we can get there together.
Embrace 2024 with the readiness to learn, adapt, and grow. Let's build your success story in trading, one informed decision at a time.
If you’re ready to take your options trading to the next level this year, I'm here to help. Reach out to me at This email address is being protected from spambots. You need JavaScript enabled to view it., and let's discuss how my mentoring can help you achieve your trading goals. Don't let another year pass by - let's make 2024 a year of strategic growth and success together.
Embracing Options: A Strategic Approach for Private Traders
As the financial markets evolve, private traders are continually seeking strategies that yield consistent returns while managing risk effectively. Options trading emerges as a powerful tool, offering a pathway to success that's distinct from traditional stock trading. Here's why options trading stands out as a superior choice for individual investors.
1. Superior Approach for Private Traders
Options trading is not just another investment strategy; it's a sophisticated method that, when understood and implemented correctly, can substantially increase a trader's profitability. Unlike direct stock trading, options provide strategic alternatives that private traders can use to their advantage, offering a blend of risk management and earning potential.
2. Evading the Pitfalls of Short-Term Trading
One of the significant hurdles in short-term stock trading is the intense competition against institutional traders equipped with supercomputers and real-time data. Options trading sidesteps this competition, offering a less frenetic environment where private traders can make calculated decisions without the need to outpace technological giants.
3. Freedom from Constant Monitoring
Trading options liberate investors from the need to monitor markets continuously. With the right strategies, such as selling premium options or setting up spreads, traders can set up their positions and manage risk without the need to watch every market tick. This aspect makes options an ideal choice for individuals seeking a balance between their investment activities and personal life.
4. Scalability for Every Investor
Whether starting with a modest sum or looking to manage a substantial portfolio, options trading is scalable to your needs. It allows traders to start small and grow their investment gradually or to employ large capital when appropriate strategies and risk management techniques are in place.
5. Diversification Through Strategy
Options provide a diverse range of strategies. Traders can hedge against market downturns, bet on market stability, or leverage market upswings. This versatility is a significant advantage, allowing traders to adapt to various market conditions.
6. Flexibility in Market Conditions
Options trading is not bound to bullish markets. Whether the market is up, down, or sideways, options strategies can be tailored to exploit these conditions, making them a versatile tool for all seasons.
7. Leverage Without Overcommitting Funds
Options trading allows for leverage, enabling traders to control a larger position with a smaller initial investment. This leverage can lead to significant returns, but it's crucial to understand and manage the accompanying risks.
Conclusion
Options trading is not just another investment avenue; it's a strategic, flexible, and scalable approach to market participation. It offers private traders a way to navigate the financial markets with a robust set of tools tailored to their risk tolerance and investment goals. By understanding and leveraging the intrinsic benefits of options trading, private traders can open doors to diversified, strategic, and potentially more profitable investing.
Ready to unlock the potential of options trading? Join me for personalized mentoring where I'll share the strategies and insights that have led to my success. Whether you're starting out or looking to refine your approach, let's navigate the path to profitable trading together. Reach out to me at This email address is being protected from spambots. You need JavaScript enabled to view it. to start your journey today!
© by Andy Jordan. Re-transmission or reproduction of any part of this material is strictly prohibited without the prior written consent of Trading Educators, Inc.
Professional Trader Marco Mayer
Educator for Forex, Futures and Systematic Trader
Creator of Ambush Trading Method, Ambush Signals, and Head of AlgoStrats.com
Ambush-Signals.com Launched in 2016 - Still Going Strong
Marco Mayer announced in 2016 a new AlgoStrats service was launched: Ambush Signals for Futures. This is how it all got started....read more.
by Marco Mayer. Re-transmission or reproduction of any part of this material is strictly prohibited without the prior written consent of Trading Educators, Inc.
The Ambush Trading System was created in 2009 by Marco Mayer. Since then it proved itself in the markets for over a decade and did so with exceptional results. It's the only trading system we're aware of that is still going strong after so many years. While Ambush is a day trading system, meaning you will always enter and exit on the same trading day - you don't have to sit in front of your trading screen. You simply place your entry orders when the trading session starts and come back at the close!
© by Marco Mayer. Re-transmission or reproduction of any part of this material is strictly prohibited without the prior written consent of Trading Educators, Inc.
Even though Master Trader Joe Ross passed away September 7, 2021, his trading knowledge of over 60 years will carry a trading legacy and will live on. As you learn about Joe Ross and understand what he was trying to teach his students, you will find that within his writings, he had a very special gift. Most importantly, it was his students that kept him striving to provide comprehendable trading material to actually teach traders and become independent, to rely on anyone, but themselves.
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 was able to survive 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 creator of the Ross hook™, and has set new standards for low-risk trading with his concepts of "The Law of Charts™" and the "Traders Trick Entry™." Joe was a private trader and investor for much of his life, but a serious health situation in the late 80'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 trading approach.
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 many different languages. His students from around the world number in the thousands. His file of letters containing thanks and appreciation from students on every continent is huge: As one student, a successful trader, wrote: "Your mastery of teaching is even greater than my mastery of trading".
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 founder and contributor of the company's newsletter Chart Scan™.
Learn the Art of Trading Joe Ross' Way!
"No market is perfect until you fall in love with it. But then, watch out. The markets are a fickle lover." -- Master Trader Joe Ross
Joe's philosophy for helping traders is:
"Teach our students the truth in trading - teach them how to trade."
and
"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.
To accomplish our mission for our students we educate them so that they know and understand:
Benefits for our Clients:
- Where prices are likely to move next.
- Independence from complicated trading methods, magic indicators, and black-box systems.
- Independence from opinion, anyone's opinion, including their own.
- Independence achieved through knowing how to read a chart.
- Independence through having knowledge of insider actions.
- Independence achieved by taking holistic and eclectic approaches.
- Independence coming from knowing how to manage both the trades and themselves.
- Independence because they understand and trade what they see.
- Independence because they have learned how and why prices move as they do, through studying the truth in trading and the truth about markets.
Students learn only proven methods and techniques, which helps them to preserve capital and create more consistent profits; they are offered simple methods that will assist them to earn while they learn.
- They learn to work smarter and more effectively.
- They learn to treat trading as a business; we offer no Holy Grail or magic systems.
- They learn to adapt to changing market conditions.
- They learn a systematic approach to trading rather than a mechanical system for trading.
- Why prices will move there.
- Who and what cause prices to move.
- How far prices are likely to move when they do move.
- Their own role in the movement of prices..
- How to take advantage of the knowledge they receive.
- How to properly manage and exit a trade which they have entered.
- How to manage themselves and acquire the discipline needed to become successful traders.
Read some personal testimonials which Joe has received.
WE APPRECIATE YOUR TRUST IN US AND THANK YOU FOR YOUR BUSINESS!
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A WEALTH OF INFORMATION & EDUCATION:
Joe Ross-Trading Educators' popular free Chart Scan Newsletter has been published since 2004.
Note: Unless otherwise noted, all charts used in Chart Scan commentary were created by using Genesis Financial Technologies' Trade Navigator (with permission).
Legal Notice and Copyright 2023 Disclaimer - Published by Trading Educators, Inc.
Chart Scan is a complimentary educational newsletter.
Dear Traders,
Master Trader Joe Ross passed away September 2021, and prior years he was continously sending me folders filled with Chart Scan and Trading Articles. The emails would be titled "More to follow" and I would reply, "Keep'em coming". I am calling these lessons "hidden vault" material because if Joe were still alive, this is exactly what would be shown in your inbox every Friday morning. This is not regurgitated material; this is new stuff written by Joe or as he would refer to it with such passion, "This is good stuff".
As we continue to receive newsletter sign ups, new students from every continent will start to learn trading Joe's way especially in this challenging market. This is where he would reinforce to his students, yes, that includes you, that learning to trade is possible even in this environment, "A chart, is a chart, is a chart". His writings will stand the test of time to provide teaching lessons and guidance.
The proceeds of Trading Educators will continue to support Joe's wife, Loretta, of 62 years of marriage, which she is our number one priority. We thank everyone with continued support and prayers for her well-being in late stages of dementia.
As expressed in the past editions, the trading world has lost a unique and passionate trader and his material will continue to be relevant. Let's start learning to trade Joe Ross' way with our future Chart Scan publications. I am here to help, so feel free to email me with any comments, questions or concerns.
This newsletter and future publications are created to keep Master Trader Joe Ross' lessons readily available to traders that want to learn and improve their skills. Our father passed away on September 7, 2021 and will be greatly missed, but his writings will stand the test of time for generations to come. Take it to heart and learn from the best through Master Trader Joe Ross' trading examples and articles which have impacted thousands of traders on every continent for over 60 years.
Happy trading,
Martha Ross-Edmunds
© by Trading Educators, Inc. Re-transmission or reproduction of any part of this material is strictly prohibited without prior written consent
