Teach Talk Trade Day Trading & Technical Analysis

For a while I have been saying it is time to “Ride the Bull in Agriculture” since I believe the bull market in food and agriculture is a virtual “sure-thing” over the coming decade and beyond.

I noted the impact that bio-fuels will have on the supply and demand equation in agriculture.  I was not supporting ethanol as a viable replacement for fossil fuels.  I try not to make the mistake of underestimating the stupidity of a government boondoggle.

Consider the energy equation.  It takes roughly 1.3 units of energy to produce one unit of energy from ethanol.  This is like trying to get rich by buying dollar bills for $1.30.  But if we’re even having the discussion, it tells me that it’s not the solution it has been hyped to be.

Think what will happen when these cars are produced in large quantities with a fuel source dependent on Mother Nature from year to year?  Ask a farmer if he can expect a bumper crop year after year.
I don’t support ethanol as a viable alternative.  I was noting the impact it may have on the agriculture supply and demand equation.  And that equation is showing that the world is beginning to demand more food than we are able to produce … even if we weren’t burning it up to produce energy. You might have seen or read recently that United States wheat inventories are at 60-year lows.  Imagine that.  The “world’s breadbasket” may have to begin importing wheat (if it’s available, that is!).  This is partly due to the ethanol rush, and the battle between food and fuel.
 
With farmers chasing the free millions from the government in corn subsidies. And by the say, that is your money they are giving away. The farmers are planting less of other crops.  When you combine these forces with the increasingly growing middle class in the developing world that are demanding more protein (it takes lots of grain to feed animals, to raise meat), it has created a massive squeeze play in the agricultural commodities. When I wrote about this two months ago, I recommended the DBA ( PowerShares DB Agricultural Fund ), which provides equally weighted exposure to corn, soybeans, sugar, and wheat.  Not surprisingly, this ETF has been rip roaring, up almost 30% year to date.

If you want to play the long-term boom in agricultural commodities, I would still think about DBA.  You should consider buying on pullbacks since it has had a strong run.

Our mission is to empower traders with timely information for improving stock and commodities portfolio results with technical analysis. How do we accomplish this, access, research and feedback.

It is well known that human emotions can interfere with making sound decisions when managing stock and commodity market commitments.  Teach Talk Trade has developed mechanical trading approaches designed to remove the emotional factor from your stock market decisions.  Online trading using technical analysis along with using Metastock is a key you your success.
Test drive our services for FREE.  Sign up for the 7 Day Free Trial.  You will get access to The Morning Call which is a 25 minute audio with over 40 charts.  We discuss Commodity Futures, ETF’s, E-mini’s and Equites.  Uncle Steve will layout the pre market conditions and discuss many of the charts with possible entry and exit points.

Most importantly, we offer an objective and consistent approach to trading. The information, contained at this site, can be used as a tool to increase your ability to manage short-term market volatility. These signals can supplement your existing research with powerful market-timing tools.

Please take advantage of the FREE 7 DAY TRIAL to The Morning Call ( we discuss 21 futures, ETF’s, E-minis, NASDAQ & Solar & Alternative Energy issues ) & The Mechanical Monkey where we discuss our mechanical trades.

T8 Retracement Trading: A series on technical trading with moving averages in the futures markets. (Part 7: Gold)

For the next few weeks, we will examine opportunities in the futures markets that are dictated by price movement and an exponential moving average: the T8. In each example, we will be reviewing previous opportunities and speculating on how to become involved in the near future. All charts will be presented in the form of weekly candlesticks and will feature three moving averages and one momentum oscillator. As you will see, these simple tools can unlock the door to profits.

Part 7 features a chart of the continous Gold contract, using weekly time frames. We define “trend” as the direction of the T8. As we can see, the trend of Yen is definitely up. Our rules are simple. We only want to initiate trades in the direction of the trend. Therefore, rule #1: Initiate trades in the direction of the trend. Secondly, we want to buy weeks that open below the T8 when it is in an uptrend and sell weekly openings that are above the T8, providing the T8 is negative. Rule #2: Buy opening retracements to the moving average in the direction of the trend. That’s it. A simple approach to trading the futures markets.

Using this strategy, you could have bought the opening price during the following weeks at the prices stated: 08/04/07 @ 659.50 and 08/25/07 @ 667.00 and again on 12/08/07 @ 789.40.  At the time of this writing, Gold was trading at 910.50. These three opportunities have turned out to be big winners since the first signal in August. Gold is not unique to this situation. Currently, over fifteen commodity futures contracts have demostrated similar patterns.

During the next three weeks, we sill see over two dozen examples of the same trading set up. THIS IS NOT A MAGIC TRICK. These specific circumstances happen again and again. We will examine precious metals, interest rates, grains, currencies and other interesting commodity futures for exactly the same set up.

Please take advantage of the FREE 7 DAY TRIAL to The Morning Call ( we discuss 21 futures, ETF’s, E-minis, NASDAQ & Solar & Alternative Engergy issues ) & The Mechanical Monkey where we discuss our mechanical trades.

 

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Monday, 28-Jan-2008

Wednesday, 30-Jan-2008

Thursday, 31-Jan-2008

Friday, 01-Feb-2008

Mechanical Trading Systems and You, Trade your Plan

Traders love to talk about their trading. The love to talk about what could be than rather what is.Intellectually, we know that the chart says everything we need to know, but as emotional beings, we are always looking for the “insight” or the “intuition” to put us a step ahead of everybody else who are all looking at the same charts we are.

Sometimes all you have to do is call up a trading buddy and say, “Hi, how are you today?” What you’ll get in return will be, “Boy, have you seen the ’so-and-so’ chart today?If that breaks the XY level, it’s going to really take off!” He continues, “And with that unstable political situation, this could really be a big trade.” Why should you care? You shouldn’t.

I guess we could take a look at the suggested chart and apply our trading parameters to it….. and if it passes scrutiny, well, that would be alright to trade, right? Yeah, OK.You have to watch yourself, though. You see, you can have a tendency to want to MAKE a trade fit.After hearing all about the great fundamentals, you can (subconsciously) view the chart with “I wanna buy” eyes, meaning that you can tell yourself that an almost-confirmation is close enough (with all those fundamentals going for it!).

That’s the danger.It’s always best, I think, to come across a trade yourself. You see a price falling….. and falling…..

gosh, when will it bottom? Your system says, “Don’t guess, be patient”. So, the market has a nice reversal day…. new low during the day with a higher close. Getting close to a buy, but not yet. The price goes higher for a few days and then starts to come back down.It’s looking good. The low holds, the market breaks the rally high and BOOM, we pull the trigger and we are in.

The system rules. THAT’S the way to take a trade.Every trader (you, included) has his or her own agenda. Only you know what works for you, system-wise and emotion-wise. Trust in your tested trading system. It will serve you if you stick to it.

Please take advantage of the FREE 7 DAY TRIAL to title=”The Morning Call”>The Morning Call ( we discuss 21 futures, ETF’s, E-minis, NASDAQ & Solar & Alternative Engergy issues ) & title=”Mechanical Monkey”>The Mechanical Monkey where we discuss our mechanical trades.
 

The ideal trading system would be one that trades without emotions.  This means that you have to develop a systems that gives you the odds, in the long run, to have a profitable trading system.  Online trading systems that take the emotion out are called mechanical trading systems.  I think that you still need some emotion in trading but  the great traders channel this emotion into competitiveness.  Most are very competitive in nature and these traders work on their systems, their risk management and work their online trading plan.  They keep their emotions out of the plan they have developed and follow the plan.  Teach Talk Trade has mechanical plans that help take the emotion out but many still try to second guess the plan.  These traders try to justify their reasoning once in the trade to take a smaller loss or lesser of a profit.  You can not and will not influence the market.  The market will do what it is going to do, you need to continually assess the markets and put the probabilities in you favor with your online trading plan.  You will have losing trades as part of you online trading plan, and if you don’t then  I will tell you that your online trading plan is pie in the sky.  Accept losses as part of the business, this is difficult to do, and learn from them.  You will not eliminate losses, so embrace them, learn from them, and know that the profitable trades are around the corner.

Please take advantage of the FREE 7 DAY TRIAL to The Morning Call ( we discuss 21 futures, ETF’s, E-minis, NASDAQ & Solar & Alternative Energy issues ) & The Mechanical Monkey where we discuss our mechanical trades.

The Drive to Succeed would be considered to be the trait I see as most important in being a successful online trader. You also need skill and talent. Skill can be gained by knowledge and practice. Talent is an inborn ability for an activity. You must have risk tolerance and have the ability to make decisions under conditions of uncertainty. All you decisions will have uncertainty built into them, you will be in a business of probabilities. You will have to get your head around this idea. Professional gamblers know they are in the business of probabilities, they try to play with the odds in their favor and you must do the same. Amateur gamblers are just throwing their money at something and hoping for luck and chance. Sure they will win some but more often than not, they will be losers in the long run. Online trading can be similar to gambling if you have the amateur mindset. You must develop the professional mindset and try to stack the odds in your favor on each trade. This is where education and practice come in. You need to develop a trading system that fits your personality, fits you risk and money management model and exploits your talents, then and only then, will hard work and discipline work in your favor. You need to be willing to accept losses, it is not a personal failure, it is a normal course of business. Would you consider Ted Williams or Cal Ripken a failure in baseball, of course not, they did not get a hit every time at bat. You will not a win each time you go to bat with an online trade.

Please take advantage of the FREE 7 DAY TRIAL to The Morning Call ( we discuss 21 futures, ETF’s, E-minis, NASDAQ & Solar & Alternative Energy issues ) & The Mechanical Monkey where we discuss our mechanical trades.

Is online trading as difficult as many say it is? Actually it is more difficult! The easy part is opening an online trading account. You can open an online trading account with as little as $500.00. In my mind that is ridiculous for a serious trader. This is for a gambler in most cases. Now this would be good for a long term investor who will contribute each month and invest in some no load mutual fund, but not a trader. Many traders get some email or go online to search for the Holy Grail, get sold a bunch of B.S. and start to trade. Trading takes education, practice and skill. I have seen articles that note that most traders blow through their accounts within a few months. When you trade, you are trading against professionals with considerable resources. Don’t get me wrong, online trading can be profitable, but you have to be realistic in your expectations, you need education and the right tools. Trading is an emotional game that needs to be conquered. You must conquer fear and greed each day, but with practice you will have the edge. Online trading requires lessons, just like if you want to be proficient in martial arts or playing the violin. Online trading requires discipline each and every day, each and every trade. You need to have a set of rules within your trading plan that enables you to evaluate your overall trading plan. It is hard to evaluate what your success are as well as your failures without a clear trading plan. Teach Talk Trade has the lessons for your success.

Please take advantage of the FREE 7 DAY TRIAL to The Morning Call ( we discuss 21 futures, ETF’s, E-minis, NASDAQ & Solar & Alternative Energy issues ) & The Mechanical Monkey where we discuss our mechanical trades.

Here I will talk about risk management in developing an online trading plan.  One area is position sizing.  Yes position sizing, do you hear me POSITION SIZING!  You have heard in real estate, location, location, location, well one mantra in online trading is position sizing.  In working your online trading plan, you will back into this area.  If you plan is realistic in its overall scope, your position size will be determined by  the plan and not some size out of your head.  When your position size is too large relative to your account size, you will engage on an emotional roller coaster.  Your online trading plan will crumble fast.  By limiting your  position size so that you are risking only a small fraction of your online trading portfolio on each trade, you are managing the emotional impact of profit and losses as well as managing your risk.  This is a part of money management also.  Many online traders are under capitalized and trade sizes that are too large for their portfolios.  They do this to generate income, their trading plan is most likely not thought out.  The emotional ups and downs will eat the trader alive, thus causing poor risk management which leads to lossesPlease take advantage of the FREE 7 DAY TRIAL to The Morning Call ( we discuss 21 futures, ETF’s, E-minis, NASDAQ & Solar & Alternative Energy issues ) & The Mechanical Monkey where we discuss our mechanical trades.

What do you suggest for the beginner or someone who is still searching for the Holy Grail?

I would suggest that this person take a hard look at themselves.  Get some education, and not the fluff that is peddled out there.  You need sound approaches starting from the basics.  Read, read, and read.  Keep current with the areas of the market that interest you.  As part of your education, you need to research the tools you will need that will help you get an edge, become more productive/profitable.  If you were a builder, would you go to work with only finish nails and one hammer in your toolbox?  This would make the process of framing a house difficult, it would be much easier if you could pull out your framing hammer and 10 or 12 penny nails, or better yet a nail gun to frame the house.  Consider participating in online trading rooms and setting yourself up like a business would, get the tools. Teach Talk Trade helps you build a solid foundation, from education, to chart room, a morning call and a live trading room.  We also have an Accelerated Educational Discount Package which is a complete package, a full toolbox, that will catapult you ahead of most traders.

Please take advantage of the FREE 7 DAY TRIAL to The Morning Call ( we discuss 21 futures, ETF’s, E-minis, NASDAQ & Solar & Alternative Energy issues ) & The Mechanical Monkey where we discuss our mechanical trades.