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Bill Williams - New Trading Dimension - New Trading Dimensions - How to Profit From Chaos in Stocks, Bonds, And Commodities

Bill Williams - New Trading Dimension - New Trading Dimensions - How to Profit From Chaos in Stocks, Bonds, And Commodities

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Published by Johan

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Published by: Johan on May 27, 2009
Copyright:Attribution Non-commercial


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In the market:honesty Is power,simplicity Is energy,and innocence Is ability.
You are standing in the airport terminal of Your Life, and the jet plane departing for the 21stcentury is about to take off. You must make a choice: Do you remain in the terminal, eatingthe stale vending-machine food of outmoded thinking? Or do you get on the plane and soar into the stratosphere of trading computerization, swept along by the jet stream of evolvingtechnology? Do you enjoy the in-flight snack of virtually unlimited information access, securein the knowledge that when you encounter the inevitable turbulence of rapid marketfluctuations, you are holding, in this book, the "automatic pilot" of expert advice andguidance? That is the vision of tomorrow that I am offering you. Let's explore together thisamazing new cyberworld of science and trading. If you don't know about these latest advancesin science and trading, have no fear. I'm not going to bombard you with technicalgobbledygook. I'm going to present you with simple, practical, well-organized, easy-to-understand information and guidance. If you are ready to travel to places you have never been before, let's queue up. Our goal in this chapter is to understand how our personal biasesdetermine whether we become consistent winners or chronic losers. If you are a type A++trader, you may be tempted to go directly to Chapter Three and begin to use our energetic andtrading dimensions immediately. Instead, I recommend that you study this material from the beginning. I believe that understanding the underlying structure of trading is imperative if youhope to reach your potential in trading for profits. Let's begin our journey of understanding bylooking at one of the most important underlying aspects of all markets—and, actually, of anyendeavor we select.
Suppose that you are a space traveler. You have just landed from a faraway planet, and youfind yourself in a room where a chess set has been arranged on a table. You want tounderstand exactly what is going on in this strange Earth. You examine the chess piecesindividually and notice that there are several different shapes and sizes. You want to reallyunderstand, so you do an "electron analysis" of each individual piece. You know the exactlocation, size, and makeup of each piece. You thoroughly understand the makeup and thecontent of the entire set. But unless and until you understand the
of playing chess, youwill never understand the game and its significance will be lost on you. In over four decadesof observing traders and trading, I have come to the conclusion that most traders approach themarket with the same orientation as our fictitious space traveler. Both are primarily concernedwith content as opposed to process. Our space traveler will never understand the game of chess until he observes two people playing and competing against each other. This is not
necessarily bad; it just doesn't have a great payoff. We traders do it with each other when weask:• How much did you make this month?• Did you go long the gold?• What kind of car do you drive?• Will you show me your P&L statements?• Can you give me someone who is using your approach profitably?• Did you know that this market is heavily oversold?All the above examples center on content rather than process. Both my scientific backgroundand my experience in trading have convinced me that the primary difference between winnersand losers is whether they focus on content or process.
Most guys had this happen in high school. You ask a pretty girl to go to a dance and sheaccepts. Now you are in trouble! You fear you will make a fool of yourself dancing and notonly will she never speak to you again, but she will tell all the other girls in the school thatyou are a klutz. You practice with your little sister and your cousin before the date. When youget to the dance, you are determined to make the dancing work. You
try hard 
to be a better dancer than you really are (you are content-oriented). But because you try so hard, you end upstepping all over your partner's feet. Your life is ruined; you were never meant to be anything but an other-handed klutz. If you could have only relaxed and become a bit more process-oriented, you could have pulled your partner close to you, she could have felt your movements, and you both would have appeared to be dancing with some skill. The key todancing well—and profiting in the market—is an ability to relax and simply go with the flow.That is what this book is about— 
 getting with the process;
letting go and going with the flow.This material will defuse much of the miseducation of modern technical analysis anddemonstrate the way the market really works and how to profit from that knowledge. When
Trading Chaos
was written several years ago, our goal was to take 80 percent out of a trendmove. We wanted to get in on the bottom 10 percent and get out on the top 10 percent of the price movement. In the intervening years, we have sharpened both our research and our strategy. Today, our goal is not to take 80 percent from a trend move but to take 300-500 percent of the trend move. Previously, if there was a 200-point move in a commodity or stock,we were well satisfied with 160 points in our pocket. Now our achievable goal is to bank 600to 1,000 points on that same move. Unbelievable? Not after you have read this book and seenthe results in your own trading.
The average trader feels that trading the markets is a highly stressful occupation. Below aresome actual questions we have received from active traders:• How can I both enjoy trading and make profits trading the markets?• Why am I so addicted to doing this when there are so many disappointments (losses)?

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