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Trading Chaos: Maximize Profits with Proven Technical Techniques (A Marketplace Book) [Hardcover]

Justine Gregory-Williams , Bill M. Williams
4.5 out of 5 stars  See all reviews (4 customer reviews)
Price: 46.95 & FREE Delivery in the UK. Details
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Book Description

12 Mar 2004 A Marketplace Book (Book 161)
How to trade the markets by integrating Chaos Theory with market sentiment In the first edition of Trading Chaos, seasoned trader and psychologist Bill Williams detailed the potential of Chaos Theory–which seeks to make the unpredictable understandable–in trading and it revolutionized financial decision–making. The Second Edition of Trading Chaos is a cutting edge book that combines trading psychology and Chaos Theory and its particular effect on the markets. By examining both of these facets in relation to the current market, readers will have the best of all possible worlds when trading. Bill Williams, PhD, CTA (Solana Beach, CA), is President of, a leader in the field of education for traders and investors. Justine Gregory–Williams (Solana Beach, CA) is President of the Profitunity Trading Group and a full–time trader.

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Trading Chaos: Maximize Profits with Proven Technical Techniques (A Marketplace Book) + New Trading Dimensions: How to Profit from Chaos in Stocks, Bonds, and Commodities (A Marketplace Book)
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Product details

  • Hardcover: 256 pages
  • Publisher: John Wiley & Sons; 2nd Edition edition (12 Mar 2004)
  • Language: English
  • ISBN-10: 0471463086
  • ISBN-13: 978-0471463085
  • Product Dimensions: 23 x 16 x 2 cm
  • Average Customer Review: 4.5 out of 5 stars  See all reviews (4 customer reviews)
  • Amazon Bestsellers Rank: 601,363 in Books (See Top 100 in Books)
  • See Complete Table of Contents

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Product Description

From the Inside Flap

Published in 1995, the bestselling first edition of Trading Chaos provided readers with the most practical and comprehensive guide for applying chaos theory to the real world of trading and investing. But today, the markets are different than they were even a few years ago. So with fresh research in hand, coauthors Bill Williams and Justine Gregory–Williams have updated their profitable methods and provide new techniques to help you take profits from the markets. Trading Chaos, Second Edition will not only show you how to anticipate, recognize, and react to impending bull and bear market conditions, it will also introduce you to the latest findings in physics and psychology as applied to various markets–stock, bond, futures, indexes, and many others. The first portion of this book is devoted to understanding how the rewards you’ll acquire in trading and investing are determined by what is happening inside of you. By digging through some very interesting and deep psychological principles, you can become a profitable "trade/vestor"–using technical techniques for good short–term entries and exits, but also holding on to long–term investments when the opportunity presents itself. Trading Chaos, Second Edition will help you build a solid psychological foundation before you enter the markets. After you’ve learned how to gain an inner analytic edge, the authors will show you how the application of self–knowledge will improve your bottom line. Through numerous charts, checklists, and examples, you’ll be introduced to proven techniques that can make the unpredictable understandable and make your journey into the markets more profitable. You’ll learn how to: Sharpen entries and exits, and reduce whiplashes with the powerful "Alligator" indicator Get into a new trend very early with proper use of the "First Wise Man" Add on aggressively after your first entry using the "Second Wise Man" with the help of the Awesome Oscillator (AO) Make fractal breakout trades with the "Third Wise Man"–these almost guarantee profitable follow–through on a trade In this early part of the twenty–first century, you have a choice to either be a part of the last generation of traders and investors using linear (ineffective) techniques or the first generation using effective nonlinear (chaotic) techniques. By reading the Second Edition of Trading Chaos, you’ll learn how you can take your trading skills to the next level and make steady profits in any market.

From the Back Cover

Praise for TRADING CHAOS SECOND EDITION "As a trader and an author for over fourteen years in stocks, futures, and options, it still amazes me when I read a book that teaches me new approaches to the market. This book is one of these amazing books that can teach the novice or the professional something important to take them to the next level of their trading. It is a must read for everyone interested in looking at the markets in a new way." –George Fontanills, President Emeritus, Optionetics "Bill and Justine Williams, two of the truly great teachers of market action, have written an outstanding book. It not only covers the psychology of personal trading but provides one with a well defined, coherent trading plan. This book is must reading for any serious trader, whether a beginner or experienced veteran." –John R. Hill, President, Futures Truth Company "What Bill Williams does best is raise questions and doubts in the minds of his readers. But, even better, he then provides wonderful new choices for thinking and acting. He has a deft lightness in his writing and a seriousness of purpose that drew me in like a magnet." –Rodney Napier, PhD, head of The Napier Group coauthor, The Courage to Act and Groups: Theory & Experience (now in its seventh edition)

Inside This Book (Learn More)
First Sentence
A number of years ago I attended a meeting in Boulder, Colorado, with a newly arrived swami from India. Read the first page
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Front Cover | Copyright | Table of Contents | Excerpt | Index | Back Cover
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Customer Reviews

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Most Helpful Customer Reviews
1 of 1 people found the following review helpful
4.0 out of 5 stars Chaos is not Chaos!! 2 May 2009
By M. Moss
An excellent book expanding on two earlier releases - all three books should be read and understood to apply the concepts to trading, but you can make money trading the concepts in this book alone. In this day and age and considering the price of the book I think colour printing would be standard to view the charting setups but everything is in black and white which is a downer. I guess that this has been done to encourage you to sign up to the Profitunity home study course but that costs $3400.00 so read the books and decide from there. You get the price of the books knocked off the price of the course if you do sign up.
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By Peter
Format:Kindle Edition|Verified Purchase
The authors of this book not only address how the markets can be traded profitably, but how you can personally profit from the markets, if you are open to changing your underlying thoughts about the market, and they will guide you through this process of change. If you what to start your journey to really be one with the markets, this is a guide which will certainly help you! May all that you wish for be the least that you receive.
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5.0 out of 5 stars Trading Chaos 5 Jan 2011
For anyone wanting to get to the next dimension in trading Bill Williams is a must!!! You will never never trade the same way again I guarantee you, read, read and read then practice, practice and practice, accept the chaos and want what the market wants.
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4.0 out of 5 stars trading chaos 3 Nov 2009
Format:Hardcover|Verified Purchase
I have been learning to spread bet since march09 using various strategies with varing degrees of sucess. i brought this book and New trading dimensions by Bill Williams and put into play his strategies. my profit have slowly increased and lossing trades becoming less. Anybody who is struggling with their trading would do well to read this book. the book is well written, however the charts are in black and whiteso i have graded it as a 4 star. i would give it 5 stars if they were in colour.

Well worth the outlay.
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Most Helpful Customer Reviews on (beta) 3.8 out of 5 stars  30 reviews
33 of 34 people found the following review helpful
2.0 out of 5 stars Trading Books 28 Aug 2006
By kiwi_trader - Published on
As an experienced trader who has bought thousands of dollars of trading books from Amazon I found this one less than impressive.

This is not about Chaos. This is not about trading Chaos.

One of the other reviewers says "It's interesting to note that in this new book, the chaos-derived indicators (alligator, AO, and fractals) are not changed."

Given that these sexily renamed indicators are just moving averages and macds with tweaked parameters then its not really surprising. For a real book by a real trader try "Trading Day by Day" by Chick Goslin. For ideas about how to trade try "The Ultimate Trading Guide" by John Hill of Futures Truth. For psychology try one of Mark Douglas's books or Brett Steinbargers book.

Good luck in a tough industry :)
44 of 50 people found the following review helpful
3.0 out of 5 stars Readable, but far from compleat 21 Feb 2005
By ServantofGod - Published on
This book is not about chaos theory, nor trading chaos, but a trading book with the first 95 pages about trading psychology, primarily Zen and Tao based, and the rest 133 pages of a trading system that comes with "Metastock". As a trading book fan and a Chinese who know Zen and Tao well, I do like the first part of it as food for thought, and definitely not as reading material to sharpen my trading edge. I doubt whether the very vague Zen or Tao approach taken by the author can be well understood and practised by western traders. Furthermore, I agree with a previous reviewer that the "trade with the trend/flow" concept preached by the author contradict a little bit with his own quasi-countertrend system presented in the second part. So, I suggest those who dont have access to Metastock nor Omega Tradestation facilities should give it a pass. It's definitely not a smart way of investing if one puts money on something that does you little good.
49 of 58 people found the following review helpful
1.0 out of 5 stars Waste of money 28 Aug 2004
By S. McCarron - Published on
Having read both of Williams' books, I was eager to get my hands on this one. Two words for you: Don't bother. It's a complete waste of $70.00. The book contains only about 60 pages talking about the technical aspect of this strategy (most of which has been regurgitated) from his other two books), and the remainder of the book is dedicated to psychology, meditation and relaxation techniques. Now I know why. If you attempt this strategy, you're going to need them! The strategy consists of a countertrend technique, in which it attempts to pick the bottom to get long, or the top to get short via proper 'angulation' away from the alligator using a 'bullish/bearish divertion' bar. There are a couple of problems with this. 1.) Proper angulation is way too subjective and interpretive. 2.) There can be more than one divertion bar along the way that is hit to signal an entry, or no divertion bar at all. 3.) This setup rarely shows up; I've scanned about 500 daily charts. Sure, the book contains pictures of charts where there have been successful countrend trades, but old data makes anyone look smart. There is a big difference between old data and trading real-time. The author explains that if a countertrend trade hits your stop (set under the low/high of the divertion bar), and it has become a fractal, you simply go in the opposite direction. However, he doesn't explain how to exit, or if/how to pyramid into the position. Additionally, I found several contradictions in the book, notably the chart of TEVA on page 152. The 'short' trade is stopped out and reversed long on a Wise Man 3 signal which is a fractal in the opposite direction that is way below the teeth on the alligator when it's hit. A few pages earlier the author explains that if the first signal isn't a divertion bar, but a fractal, it should only be taken only if it's hit above the teeth!

Conslusion: Sure the book inlcudes some impressive pristine countertrend trades based on angulation and divertion bars in both directions, and exiting by either a SAR divertion bar in the opposite direction or a 3-5 bar trailing stop (discussed in book). Realisticaly, these trades just don't show up that often in the market (most stocks meander too close to the alligator to warrant proper entry according to this book), and a mechanical 3-5 bar trailing stop is going to get you out way to soon if you just so happened to guess correctly when entering. Simply put, the methodology is too interpretive - Like I said, anyone looks smart using old data. Also, there is no detailed explanation on how to exit a trade if stopped and reversed after a countertrend trade doesn't move in the expected direction, and the book doesn't offer any examples. Lastly, because there is no systematic way of testing this system because it's based on subjective interpretation, you can expect countless whipsaws and endless frustration if you decide to trade it without any predetermined probability of success. But what the hell, some of the relaxation methods discussed can help with that!
22 of 25 people found the following review helpful
5.0 out of 5 stars Mind blowing 15 April 2006
By Andrew Kasch - Published on
Format:Hardcover|Verified Purchase
The actual trading methodology is not really of interest to me. As a matter of fact, it's ironic that in the first half of the book statements such as "there is no magic system" and "all mechanical systems will fail" are made, then in the second half of the book a rather mechanical trading system that is referred to as "automagic" is described.

I suppose for a beginning trader looking for some kind of method to employ it's not a bad one to pursue. Allow me to suggest that the second half of the book should be given perhaps 10% of your consideration while the first half should be given 90%.

The first half of the book is revolutionary, and makes it a classic. It should be removed and marketed separately. In fact, I like your chances of success better if you only read the first half and then develop your own trading method based on what you notice happening in the market. Concentrate on developing a winning mindset and getting in tune with the market you trade. The first half of this book should be kept and reread regularly.

14 of 16 people found the following review helpful
1.0 out of 5 stars Contradicts his own theory 27 Sep 2008
By Haritasha - Published on
Format:Hardcover|Verified Purchase
When I first started reading this book I thought it was going to be great. He really sounds good talking about Zen and Chaos theory and non-linear vs linear - and I think he is right that the markets behave under these concepts. However, he doesn't really tell us how to apply any of this to trading. Read this book and then look at a chart. Can you trade better now knowing that you should be using a non-linear, chaos approach? No! Why? Because he doesn't tell us how to apply that theory to trading. He tells us to be one with the market and flow with it etc. That's fine and dandy - but how do we do that?

He tells us that ta and mechanical systems don't work, then he reveals the system he uses to trade by - a mechanical system!!! I was shocked to see that his system is just another dime a dozen 3 ma system. How is his system using non-linear chaos theory? How is his system flowing with the market and making you more "in tune" with the market? It's just another mechanical ta system!!!(kind of sad really)

This book started with great promise but ended up being a total disappointment.
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