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Figure 6-6 Drifters 1-3, 2-3, and 1-2. amount of information. We cannot be certain that either buyers or sellers were in charge at the end of the period. We know now that, by looking at the open, high, low, and close of a bar, we are able to tell a great deal about who is in charge and what they are doing. The important concept to grasp is that each bar clearly indicates how the interaction between buyers and sellers moved the balance point around during the period. This information alone is...

Fractal Hump Signals

The middle two columns of the worksheet (Figure 10-1) provide the boundaries within which we will trade, and our trading tools are contained in the Hump Signals and Thumb Signals columns. Our job here is simple we are working now with only the current trading time frame. We again read from right to left (current to past bars), and we note the last fractal buy and sell signal that still contains appropriate leverage. See Chapter 8 for a full description of fractals and leverage.

Your Personal Trading Software Programs

In your personal trading software file, you have four different programs or disks 4. Have fun program. Although you use all of them in daily living and trading, you can use only one at any instance (they can be switched very rapidly, however). In this section, we will look at the four programs in the order of the size of the group of traders using them on an average day in the market. Your own individual belief systems will determine what software programs you run while trading the market. A...

Level Five The Expert Trader

Since nobody is quite sure why we were put on this earth in the first place, I suppose we might as well have as good a time as we can. GOAL TO UNDERSTAND THE PERSONAL BELIEF SYSTEMS AND PERSONAL TRADING PROGRAMS WE CARRY WITH US TO THE MARKET AND TO LEARN HOW TO INTEGRATE THEM WITH THE UNDERLYING STRUCTURE OF THE MARKET You are now approaching the pinnacle of trading, where almost everything you do increases your growth, satisfaction, profit, and happiness. You have traveled a road experienced...

Review Questions

What are the three principles of communication that apply both to individuals and to the markets 2. What do you feel is your own predominant body structure 3. What one word would sum up your predominant characteristic 4. Based on question 3, how could you set up your trading to be most effective and what are you looking for 5. What are the three different traders living in your skin 6. Name the five behaviors that occur only in the left hemisphere. 7. What are the two functions of the left...

The Right Hemisphere

We know that the core is literally hundreds of thousands of times more powerful than our conscious left hemisphere, but no one seems to know the exact power of the right hemisphere. As for its function, the right hemisphere is the source for the three big I's When your right hemisphere is running the show, everything seems effortless. Instead of a struggle created by the left hemisphere or a roller coaster created by the core, the right hemisphere is just a float down the river (Figure 11-7)....

The Core

Physically, the core consists of the limbus, the reticular activating system, the thalamus, the hypothalamus, and the whole spinal section of the brain. The left hemisphere is analogous to a digital computer the core is more like an analog computer. Our survey of research indicates that the core can handle from 500,000 to 3,000,000 bits of information per second, compared to the left hemisphere's measly 16 bits per second. If you were to close your eyes right now and name every item you...

The Human Brain

Nature vs. the Mapmaking of the Brain First, humans do not have a brain we have many brains. The right hemisphere, left hemisphere, and core are the main three brains. In the left hemisphere (the part of your brain that is reading these words), 2 + 2 4. In nature, this is not true at the universe level or at the level of quantum mechanics. The laws of arithmetic are true only because we voted to make them true and we now teach them as the truth. Ask adults why 2 + 2 4, and they will tell you,...

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Agressive Competitive Likes Rare Steaks Keeps Emotion Inside Likes Silence Poor on Routine Wants Security Good Persistence Dreams a Lot Figure 11-3 The three body types and their characteristics. build, each becomes subject to unique irritations. For example, whenever endomorphs visit their doctor, odds are their problem is a gastrointestinal complaint. Mesomorphs' complaints to their doctor usually center around cardiovascular or muscular problems. When ectomorphs go to their doctor, their...

Level Two The Advanced Beginner

TO UNDERSTAND THE CONNECTION BETWEEN THE MFI AND ELLIOTT WAVE COUNTING. 2. TO USE THE PROFITUNITY MACD TO TAKE THE AMBIGUITY OUT OF ELLIOTT WAVE COUNTING. We pointed out earlier that germination energy always follows entry into a new experience. Once they discover that more is involved than they had first envisioned, most new traders become discouraged and never achieve what is there just for the taking. At Level Two, you approach this most critical juncture. Will you become discouraged and...

Level Three The Competent Trader

The chief object of education is not to learn but to unlearn. GOAL TO GAIN THE ABILITY TO READ THE MARKET ACCURATELY AND KNOW THE RESPONSES THAT WILL MAXIMIZE RETURN ON INVESTMENT. THIS REQUIRES LEARNING TO USE PROFITUNITY PLANNED TRADING AND PREPARING TO USE PROFITUNITY TRADING PARTNER . We are now entering the third level in our journey to Level Five. A pianist at this level is able to play a written piece of music perfectly. This requires reading and recognizing the instructions given on the...

Level One Novice Trader

Nature's way is simple and easy, but men prefer the intricate and artificial. GOAL TO START READING THE MARKET ITSELF RATHER THAN READING OTHER PEOPLE'S OPINIONS ABOUT THE MARKET In this chapter, we will look at the fundamentals that are necessary to begin understanding and trading the markets. The best way to approach this material is to consider each item and each decision as a learning experience. As mentioned in the previous chapter, there is a great deal of excitement in starting a new...

Integrating Your Personal Software Programs

Let me emphasize that I believe these next few pages are the most important pages in this entire book. Please spend some time understanding controlling and practicing this process. It is lethal to losses. Take this advice with you every day in the market Through the years, working with our own personal trading and with thousands of full-time traders, we have developed a technique that will ensure that you can trade at Level Four and Level Five. As stated above, you have four different software...

C2 JL Range

In trading, the mass would correspond to volume, and the energy would correspond to the price movement. Would Einstein agree I have no idea, but it's fun to speculate, in trading and thinking. We are measuring the effective change in price per tick. This number has no absolute value. Its value lies in comparing this number with a previous MFI. For example, if the current bar's MFI .541, that is not comparable in any way with a bar from yesterday's chart that might have a value of .541. We are...

Level Four The Proficient Trader

The more I study physics, the more I am drawn to metaphysics. GOAL TO EXPLORE THE LINKS BETWEEN THE CHARACTERISTICS OF SUCCESSFUL TRADERS AND THE CHARACTERISTICS OF THE MARKET AND BETWEEN SELF-KNOWLEDGE AND PROFITABLE TRADING. In this chapter, we make a radical departure from Levels One through Three. We now begin to work with our own underlying structure. If we can align our own underlying structure with that of the market, winning becomes the path of least resistance. Using our earlier...

The Air Bag Protection Against Disaster

I have been driving a car for over 45 years and have never been in an accident that I have caused. From that history, you might conclude that I am or at least have been a careful driver and need limited protection from my own driving. During that same 45 years, I have been through the windshield twice in head-on collisions. In both cases, I was sitting in the right-front passenger seat and the driver had the car in the proper lane, at a speed that was lower than the limit. Both accidents were...

Worksheet Date

Figure 10-5 Key areas of the rhythm column. zeros. Remember that our profession is one of speculation and as good and highly paid speculators we must see paradigm changes before the masses do. When a move becomes obvious to everyone, it will have all four arrows in the same direction. By then, most likely, it will be too late to climb aboard. It will definitely be too late to squeeze the maximum amount of available profit from the move. I would want an overriding reason before I would place a...

Summary

When you are operating at Level Three, you are in the top 3 percent of all traders in the world. You should be taking money out of the market on a regular basis and maximizing your ROI by your skill in allocating assets and varying the volume of contracts you are trading. Profitunity Planned Trading allows you to be minimally invested when the risk is greatest and maximally invested when the risk is least. If you can make profits trading on a one-contract basis, you should be able to double...

Chapter Addendum

Let me share with you some vital research that has affected the world's Olympic teams since 1972 and will influence your trading and your life. Around 1952, several universities decided to study how to increase the effectiveness of various methods of improving athletic performance. Athletic performance was chosen because slight differences can be easily measured. For example, if a sprinter has been running the 100-meter dash for years, and, because of a training-method change, the sprinter's...

The Market Facilitation Index

Whenever the tick volume goes up, we know we have more outside paper coming in whenever it goes down, we know that less outside paper is coming to the floor. Our next task is to assess accurately the effect this change in volume has on the market. It is not enough to know how much it is more important to know how the market reacts to this change in volume. Heavier volume does not always mean the market will move. The market's main task is to find a balance point, and it will do it in a fraction...

Profitunity Trading Partner

Profitunity Trading Partners

Every divided kingdom falls, so every mind divided between many studies confounds and saps itself 1. TO INCORPORATE THE SKILLS LEARNED IN LEVELS ONE, TWO, AND THREE INTO AN EASY-TO-USE CHECKLIST THAT WILL IMPROVE TRADING EFFICIENCY. 2. TO BE ABLE TO COMPLETELY ANALYZE A MARKET IN 10 SECONDS OR LESS. One of the perennial problems all traders face is how to condense the enormous amount of material the market is putting out each minute into an easy-to-understand decision-making format. A...

Thumb Signals

The next step is to note any thumb signals see Chapter 8 and include them appropriately on the buy or sell line. At this point, we have condensed all the necessary direct market information and have converted it into easy-to-read trading signals. To integrate this material with our current positions, we list our ongoing trades in the Current Trades column. When all this information is at hand, it is time to make an executive decision. We consider our current equity and the number of positions...

The Elliott Wave

Profitunity Trading Partners

The primary reason to be interested in understanding the Elliott wave is that it is the best indicator of where you are in the market's movement from down to up and back down again. Reading the market is like trying to understand how New York City functions. You could spend one day with each of the five borough presidents, to get an in-depth understanding of what is happening in each borough at that time. Another approach would be to take a helicopter and view the entire city from about the...

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Figure 9-10 Weekly Swiss franc chart used in the PPT strategy. Figure 9-10 Weekly Swiss franc chart used in the PPT strategy. contingency plan if the count is incorrect. My Point Zero was followed, as expected, by a sharp upturn that ended at 6011 on June 5, 1989. By going to a smaller time frame dailies and 60-minute charts , a complete five-wave sequence could be counted. At this point, I calculated a 62 percent retracement and put in an order to buy three contracts at 5736 or better, with a...

Using Fractals and Leverage

Fractal Chaos Bands

Come to the edge of the cliff ' he said. We're afraid ' they said. Come to the edge of the cliff ' he said. We're afraid ' they said. Come to the edge of the cliff ' he said. They came. He pushed. They flew. 1. TO UNDERSTAND AND BE ABLE TO RECOGNIZE AND TRADE THE INITIATING AND RESPONSIVE FRACTAL PATTERNS 2. TO UNDERSTAND HOW LEVERAGE EITHER SIGNALS A TRADE OR CANCELS A POTENTIAL TRADE. Commodity traders and system sellers have a knack for taking any new development and applying it to trading....

Info

Navigating the Markets The Need for Good Maps GOAL TO STUDY THE UNIVERSAL STEPS FROM NOVICE TO EXPERT AND APPLY THEM TO BECOMING A SUCCESSFUL TRADER So far, we have discussed the present condition of the majority of traders, looked at how really simple the market is, examined chaos as a more effective trading paradigm, and delved into the two different structures of structure. In this chapter, we construct an interactive map that will guide us through the rest of this book. We want explicit...

Bill Williams PhD

1 A Look at the Current Reality of Trading 3 Chaos Theory A New Paradigm for Trading 4 Defining Your Underlying Structure and How That Affects Winning and Losing 5 Navigating the Markets The Need for Good 7 Level Two The Advanced Beginner 9 Level Three The Competent Trader 11 Level Four The Proficient Trader 12 Level Five The Expert Trader Bibliography A Look at the Current Reality of Trading The beginning is the most important part of the work. GOAL TO UNDERSTAND THE AVERAGE TRADER'S VIEW AND...