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Commodity Trading Lesson Index
 
 

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.

       

      Bruce Gould

Proceed to lesson 38 by clicking here.

 

Always remember that stock, options, and futures trading may involve substantial risks and that past performance is no guarantee of future performance.