03/22/05 The "Bigger Fool" trading theory

03/22/05 The "Bigger Fool" trading theory

Marketline March 22, 2005 Wheat futures were sharply lower Monday though Portland white wheat was off just a few cents. Gary Hofer of Gary Hofer Commodities, says many people pointed to a stronger dollar for plunge in wheat, but he says that's was just an excuse for exiting positions that were dependent on the BFT. Hofer: "That's the "Bigger Fool Theory trading method in which one asks why one should pay such a foolish price for wheat, the answer is, so I can sell it to even a bigger fool. When fundamentals are so clearly defined with plenty of wheat for sale around the world and a decent winter wheat crop coming out of dormancy with good moisture conditions in the Midwestern U.S. holding a long bought wheat position begins to look risky. The wheat price trend in Chicago has turned at least short term negative." On Monday Chicago May wheat was down 14 cents at 3-42 ½. May corn down 5 1/4 at 2-14 ½. Portland cash white wheat one to two cents lower at mostly 3-94. New crop August white wheat down a penny at 3-96. Club wheat 3-97. PNW HRW 11.5 percent protein lower at 4-22. Dark northern spring 14% protein lower at 4-99. Export barley 101 dollars a ton. USDA announced Monday that Egypt has lifted its ban on U.S. beef on animals less than 30 months of age. In 2003 Egyptian purchases of U.S. beef amounted to about 30-million dollars, with liver accounting for two-thirds of that. The Plains fed cattle trade was quiet Monday. Boxed beef was weaker. Cattle futures were higher. Analysts said a lack of selling interest seemed to be the main feature. April live cattle up 45 cents at 87-85. April feeders up 70 at 104-12. April Class III milk down two cents at 13-99. I'm Bob Hoff and that's Marketline on the Northwest Ag Information Network.
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