Lesson 37: Mrs. B - "Buys Wheat"
On Monday morning, September 24th, 2001, before the
markets open in Chicago, our hypothetical Mrs. B plans to call her
hypothetical commodity futures broker with the following hypothetical order,
"Buy l contract of Chicago May Wheat at $2.87 or lower,
day order only".
Chicago May Wheat futures closed on Friday, September 21st,
at $2.86. Mrs. B is willing to buy the May Wheat Futures
contract and pay a premium of 1 cent above Friday's close to do
so. There is no certainty, however, that Mrs. B will be able, on
Monday, to buy the May 2002 Wheat Futures contract at this
price since the market may not trade at that level. With a
close on Friday of $2.86, it is likely, however, that this
hypothetical trade will hypothetically take place. We will know once
the markets open and close on September 24th. Mrs. B
will try to buy Chicago May Wheat on Monday, September 24th,
and she plans to use the "Choppy Market Method"
to trade her position once she has acquired it. If Mrs. B is able to
assume her hypothetical wheat position, you will be able to follow
her hypothetical trade on this Web site. A new lesson will be
posted Monday, after the markets have closed for the day.
To order a copy of Bruce Gould's "Choppy Market Method" to
understand "Mrs. B's" reason for picking May Wheat Futures
at this time, at this price, click
here.
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