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New Trading Dimensions: How to Profit from Chaos in Stocks, Bonds, and Commodities (A Marketplace Book)
By Bill M. Williams


 


Product Description:

A powerful new way to navigate today's unprecedented market conditions

"Bill Williams' pioneering application of chaos theory to the financial markets is leading technical analysis into the twenty-first century and beyond. New Trading Dimensions presents a complete, highly original, and intriguing trading method with clear, detailed illustrations, and challenging practice pages. Bill's wisdom, technical expertise, and skillful teaching style make this a revolutionary must-have new book for stock and commodity traders." -Tom Bierovic, Product Manager for User Education, Omega Research, Inc.

"Bill hits the nail on the head. The essence of successful trading is a combination of knowing who you are and allowing the market to reveal its secrets. Bill Williams has the gift of explaining these concepts better than anyone I know. This is a compelling work that belongs in every trader's library." -George Angell, author, Profitable Day-Trading with Precision

"Bill Williams is one of the great educators of our time. He freely shares his knowledge and experience in this inexpensive book. This book is required reading for all market technicians. The principles are sound as we have tested them with our software." -John Hill, President, Futures Truth, Co.

"Bill Williams has always been an excellent teacher, taking complex terms and concepts and translating them into a clear, commonsense approach to trading. This book provides a complete trading program that reflects Bill's years of wisdom and experience in the marketplace." -Darrell Jobman, Editorial Consultant and former Editor-in-Chief of Futures magazine

As today's market environment continues to change dramatically, more and more traders are discovering that traditional forecasting methods-pure technical analysis and fundamental analysis-just do not work. Sending out contradictory messages, these opposing schools of thought leave investors baffled about the future direction of the market, and consequently, at a loss as to how to tailor their trading systems. As a result, many practitioners have now turned to a new forecasting "cocktail" that combines traditional charting methodologies with chaos theory and human psychology. In this groundbreaking book, Bill Williams, a seasoned trader at the forefront of this dynamic new approach, explains exactly what it is, how it works in current stock and commodity markets, and how to use it to your advantage.

Based on human nature rather than the vagaries of the market, the new trading dimension works on the premise that we trade not the market, but our own belief system. By assessing what your personal biases are, you can determine how they influence your ultimate success-or failure-and then adjust your trading strategies accordingly.

Written by an expert in the field who has been featured in Futures, Worth, Success, and other prominent publications, New Trading Dimensions takes the latest in scientific knowledge about human behavior and applies it directly to the fields of stock and commodity investing and trading. With straightforward guidelines, it shows you how to adopt the right attitude toward the behavior of the market and use the right tools (ATTITOOLS) for profitable trading. Packed with practice exercises, specific applications to different types of investments, and a detailed review of important market signals, here's where you'll learn how to:
* Discover what the market wants and align your own beliefs with the direction of the market
* Apply chaos theory to trading and investing
* Use Williams' "Market Alligator" for analyzing and profiting from the markets
* Employ a multidimensional trading program that includes such tools and techniques as fractals, oscillators, AC signals, psychological zones, and balance lines
* Exit trades in a timely fashion to reap high returns

Drawing on the author's more than forty years of experience as both a successful trader and seasoned trainer, this invaluable guide offers a breakthrough method that has proven its ability to turn investors into consistent winners.



Summary: If you use the alligator method of trading: Vote For - else if not - Vote Against
Rating: 5

1. Everything in the Universe follows the path of least resistance

2. An always underlying and usually unseen structure determines the path of least resistance.

3. The always underlying and usually unseen structure can be discovered, and it can be altered.

4. The four largest money gatherers and distributors in the world are: war, medicine, insurance, and religion.

5. Traders who let the new incoming information organize their trading will be in sync with the market and thereby will be winners.

6. "The market is infinitely complex. Freedom and free will-strange attractors-prevail over rules and determinacy.

7. Fractals are the way markets organize themselves.

8. Everything that exists is drawn out of this quantum soup by attractors. All outer phenomena are governed by four attractors: point attractor, cycle attractor, torus attractor, and strange attractor. Point attractor lives in the dimension of a line, which is made up of infinite number of points. Whenever, a point attractor is governing, a person is drawn to one particular activity, or repelled from another. The cycle attractor is back and forth movement, like a pendulum or circling magnet. It is characterized of a range bound or bracketed market where the price moves up and down in a range over a period of time. One activity automatically leads into another activity. In grain markets, one year of high prices produces more plantings in the next spring, which produces lower prices. The cycle attractor produces a structural tension between the two poles and opens the way for integration between the two opposites. The torus attractor begins a complex cycle that repeats itself as it moves forward. If the bond interest goes up, it attracts mre investors. Bond prices go up, which lowers the interest rate and makes bonds less attractive, and so on. Third dimension, predictions are more precise, higher degree of irregularity, patterns more complex, and repeating function. Strange attractor becomes self-organizing. One characteristic of strange attractor is its sensitivity to initial conditions. The slightest variation in the beginning can make enormous differences in the end result. The strange attractor allows us to participate in the ebb and flow of the market and of life.

9. Bill Williams trade approach involves five perspectives: 1. Momentum 2. Change in the speed of current momentum 3. Appearance of initiating fractal 4. zonal influences 5. balance-line differentials.

10. To win consistently in the markets you must get to know them and how they process incoming information. Get in tune with the market and change your belief about the market and the world.

11. One of the keys to profitable trading is to take only those trades with the most potential and stay out of situations where there is marginal potential.

12. Most of the time the market goes nowhere and about 15 to 30 percent of the time does the market trend. We don't want to waste time entering and existing the market without profiting, if the market is going nowhere then opportunity is going nowhere.

13. Alligator is blue line (13 bar moving average), red line (8 bar moving average offset 5 bars into the future), and green line (5 bars moving average 3 bars into the future). Blue is the jaw, red line is the teeth, green is the lips the balance line. When all three lines are intertwined the alligator is sleeping, range bound market. We don't want to loss money during a range bound. All five highs or lows should be on the same side of the blue balance line. The stop to exit is just inside the red line (teeth).



Summary: Extremely specific strategies and tactics involving MACD and Moving Average Oscillator
Rating: 5

If moving average oscillator is part of your trading plan, this book will help tremendously. This book has very specific strategies and tactics concerning moving average oscillator usage. Although they are not meant to be mechanized, they are systematic enough to be used in very structured way.



Summary: One of the keys to becoming a better trader...
Rating: 5

I've read all three books by Bill Williams and I think this is his best work.

I'm not sure if I agree with every trading tool that he presents, but, like any new information: you apply them to your own objectives. However, make no mistake...his ideas are important and he's done extremely well to lay them out in a readable manner.

This is just my own opinion, but I feel that you can't dismiss other aspects of technical analysis. Combining a few important technical rules with non-linear trading techniques will produce excellent results as long as you apply them correctly. Further, I've read many books on linear mechanical trading models and usually they don't describe ideas that lend themselves to you as a trader adapting efficiently to changing market conditions.

Put simply, if you read between the lines, he suggests a way of thinking that is non-linear and constantly changing: the crux of the markets.



Summary: Worth reading
Rating: 3

It's not the trading methodology that makes this book valuable. Whenever I reread it I completely skip that part. As a matter of fact, in his next book "Trading Chaos Second Edition" Bill pretty much admits the system underperforms in current market conditions and makes the very significant refinement of using a counter-trend signal that he refers to as a "divergent bar" for first entry. He says without saying it in that book that those following the method in this book will be "late and have a difficult time making any money."

No, the reason I have held on to this book, instead of selling it with the others, is the psychological stuff, and the innovated way he ties physics in with successful trading. It is very introspective, thought-provoking, and yes, quite helpful. To quote the book, get out of the win vs. loss mindset and get into the here and now process of noticing what is happening and being in tune with the market.

[...]



Summary: It is a bad book. Yes, it is that simple.
Rating: 1

It is a bad book. Yes, it is that simple. If I were to write in the stile of the book, I would say something along this line:

"I tested the theory on super mainframe personal computer to realize that it is wrong for our times."

No, I did not make a mistake. Author actually alleges to test his theory on super computers at some places and super mainframe computers at others. As far as I know, when mainframe computers were the main part of computer departments super computers were not. Super computers cost millions of dollars and were not available to business people for trading testing. Our days, of cause, most PC (personal computers) are much more powerful than old mainframe computers. Servers in IT departments use PC based technology working on the networks. So, why does the author used this archaic terminology instead of telling you to test it on your home computers? Did he what to empress you or instill the need in his "super mainframe computer" service?

OK, so author is not exactly on the cutting edge of technology. But maybe he knows trading as it applies to chaos theory? No, he does not. The book uses moving averages crossovers and a variation of MACD (as difference between two moving averages) as the base of the trading method. Of cause moving averages are transformed into the alligator and MACD into some new indicator. How innovative is it? He also uses a variation of high point definition with a chaos name of a fractal. Well done! Now most of us will think it is a trading chaos book.

If you are not familiar with MACD and moving averages there are better books on the subject. Do not buy this one.