Dealing with Losing Trades | Support and Resistance Levels

Support & Resistance Levels

This Blog provides futures market outlook for different commodities and futures trading markets, mostly stock index futures, as well as support and resistance levels for Crude Oil futures, Gold futures, Euro currency and others. At times the daily trading blog will include educational information about different aspects of commodity and futures trading.

Dealing with Losing Trades | Support and Resistance Levels

Jump to a section in this post:
1. Educational Feature: Dealing With Losing Trades
2. Support and Resistance Levels – S&P, Nasdaq, Dow Jones, Russell 2000
3. Support and Resistance Levels – Gold, Euro, Crude Oil, T-Bonds
4. Economic Reports for Thursday November 3, 2011

1. Educational Feature: Dealing With Losing Trades

(Note: This feature is a favorite of mine, and I believe all traders need to address this issue every once in a while.)

A main tenet of success in futures trading is the ability to accept losing trades as part of the overall trading process. This is not an easy undertaking–especially since many futures traders tend to be of a more competitive nature in the first place. Traders certainly don’t have to enjoy losing trades, but they must accept the fact and move on. Those who can’t accept the fact that losing trades are a part of futures trading usually don’t stay in the business very long.

My wife is a school teacher, and one of her favorite acronyms–ADM–can be applied to losing futures trades. “Accept” it. “Deal” with it. “Move” on. (This is a part of the important psychological aspect of trading, and deserves much more discussion than I can provide in this feature.)

I had lunch with one of my trading mentors a while back. We discussed losing trades. I asked my mentor how many losing trades in a row he has had to endure during his long and successful trading career. His reply was 13 in a row. I asked him how he coped with that. He said that while it was certainly not easy, he knew that losing trades are a part of the business and that he was in the business “for the long haul,” and that his trading methodology was sound. He added, “Ninety-percent of futures trading profits are made on 10% of the trades, which means most of the other trades are either small losers or break-even-type trades.” This is an important fact for all traders to keep in mind.

My lunch meeting with my mentor was good for me because, even though we made no “break-through” discoveries on the path to increased futures trading success, we did reaffirm our own philosophies on trading and markets. My passion for trading and market analysis is fed immensely every time I talk with people in my profession, or attend the quality trading seminars.
For many of you, the futures trading arena can be more fulfilling (and more fun) if you have someone, or some support group, with which to share your thoughts and strategies. If you are passionate about futures trading and markets, finding someone who shares that passion is a great trading tool within itself!

That’s it for now. Next time, we’ll discuss another important issue on your path to trading success.

2. Support and Resistance Levels – S&P, Nasdaq, Dow Jones, Russell 2000

Contract (Dec. 2011) SP500
(big & Mini)
(big & Mini)
Dow Jones
(big & Mini)
Mini Russell
Resistance Level 3 1294.83 2443.67 12546 794.87
Resistance Level 2 1277.17 2405.83 12277 772.83
Resistance Level 1 1266.33 2383.67 12129 759.17
Pivot Point 1248.67 2345.83 11860 737.13
Support Level 1 1237.83 2323.67 11712 723.47
Support Level 2 1220.17 2285.83 11443 701.43
Support Level 3 1209.33 2263.67 11295 687.77

3. Support & Resistance Levels for Gold, Euro, Crude Oil, and U.S. T-Bonds

Contract Dec. Gold Dec. Euro Nov. Crude Oil Dec. Bonds
Resistance Level 3 1793.7 1.4093 99.21 142 21/32
Resistance Level 2 1781.0 1.3974 96.91 142 4/32
Resistance Level 1 1772.9 1.3891 95.47 141 17/32
Pivot Point 1760.2 1.3772 93.17 141
Support Level 1 1752.1 1.3689 91.73 140 13/32
Support Level 2 1739.4 1.3570 89.43 139 28/32
Support Level 3 1731.3 1.3487 87.99 139 9/32

4. Economic Reports for Friday November 4, 2011

Final Services PMI

PPI m/m

German Factory Orders m/m

Non-Farm Employment Change

Unemployment Rate

Average Hourly Earnings m/m

FOMC Member Tarullo Speaks

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