New Concepts in Technical Trading Systems
An Introduction

'New Concepts in Technical Trading Systems' is a book on some of the technical indicators which are commonly used in stock trading. It is authored and self published by J.Welles Wilder in 1978.

J.Welles Wilder Jr. is a mechanical engineer from America. He formulated Average True Range (ATR), The Relative Strength Index (RSI), Average Directional Index (ADX) and The Parabolic SAR. These are considered as some of the very important indicators and thus they are included in most of the trading software.

New Concepts in Technical Trading Systems deals with the formulas, interpretation and usage of The Parabolic Time/Price System, The Volatility System, The Directional Movement System, The Trend Balance Point System, The Relative Strength Index, The Reaction Trend System, The Swing Index System, The Commodity Selection Index and Money Management.

Among these The Parabolic Stop and Reverse, Directional Movement Index (ADX) and the Relative Strength Index (RSI) are considered to be most significant.

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This technical analysis book established J.Welles Wilder as one of the world leading technical analyst.

But this book merits more than mere admiration. For traders looking for carefully presented formulas, clear discussions of their logic, and helpful discussion of indicators' interpretation straight from the horse's mouth, this book is a great asset.

For a discretionary trader who do little, if any, back testing or who pay no more than scant attention to indicators other than price & volume, and maybe some moving averages, this book probably won't hit her hot button.

But for a systems trader, it is especially appreciative, since nowhere else you can find a better or more authoritative discussion of ADX and ADXR, two especially potent indicators whose multistage calculations haven't been consistently represented in various secondary sources.

For those traders who tend to enjoy tinkering with the development of their own novel indicators, Wilder's discussions of his conceptual starting points in developing each of his technical indicators will probably prove very stimulating.

What does this book contain?

The book has the following chapters divided into 10 sections, as follows:

Section 1

  • Basics
  • The Missing Part of Most Trading Plans

Section 2

  • The Parabolic System

Section 3

  • The Volatility Index
  • The Volatility System

Section 4

  • The Directional Movement Concept
  • The Directional Movement System

Section 5

  • The Momentum Concept
  • The Trend Balance Point System

Section 6

  • The Relative Strength Index

Section 7

  • The Reaction Trend System

Section 8

  • The Swing Index
  • The Swing Index System

Section 9

  • The Commodity Selection Index

Section 10

  • Capital Management
  • Conclusion


  • Glossary of Terms and Abbreviations
  • Printed copies of each work sheets

How to study New Concepts in Technical Trading Systems?

Any section can be studied independently of any previous or following section, except for section 1. That means read section 1 as it pertains to certain basic tools and definitions which apply to all following sections, then read any section of your choice and requirement.

However the reader is advised to compulsorily read Sections 9 & 10 before starting to trade.

It is a must have investment book for a serious, progressively evolving successful trader.


  • Forbes Magazine (October 1980) singled out Mr Wilder as 'The premier technical trader publishing his work today.' It adds, 'For those of you who have seen all the conventional systems, this book is the place to start.'
  • Barron's (July 1984) - 'In 1978 the basis of mathematical analysis was expanded when J. Welles Wilder, Jr. published New Concepts in Technical Trading Systems.'
  • Financial World (July 1985) - 'Over the years, Wilder has developed more accurate commodity trading systems and concepts than any other expert.'
  • Technical Analysis of Stocks and Commodities (February 1986) - 'It's not often that truly original discoveries are made in technical market analysis. J. Welles Wilder, however, lays claim to an entire collection of systems that have reshaped contemporary commodities trading and analysis.'
  • Technical Analysis of Stocks and Commodities (October 2002), in an article titled The Titans of Technical Analysis, Welles Wilder was selected as one of the 'Heroes of Technical Analysis.

This book was sold at $65.00 in 1978, when other similar books were sold at $5.00 or $10.00.

$65.00 of 1978 is equivalent to approximately $500.00 in today's money value.

The good news is that New Concepts in Technical Trading Systems is still available for $65.00 only.

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The other books he has authored are:

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