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TAKEN FROM TROUTMAN www.teleport.com/~troutman/
You can find reviews of many products like thi at this wedsite.
This is a Review and an Opinion
This review is my opinion and nothing else. I am an expert only in regard to
what I believe and understand. I do not intend to violate copyrights with
this review. If you believe that an infringement has taken place, email me
with specifics immediately. I would appreciate your comments, positive or
negative, about "The Delta Phenomenon" or my review. If you wish, I am
willing to publish additional opinions or factual (but legal) information
that you have about the book or method. Thanks!
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SYSTEM: Delta
AUTHOR: Welles Wilder
QUICK SUMMARY: Forecasts market turning points
QUICK OPINION: A good starting point for research, okay as a minor indicator
COST: $175 book, > $1,000 for the exact market solutions
CONFIDENTIAL?: Yes; VERY restrictive non-disclosure agreement must be signed
SUPPORT: Monthly newsletter, $200 yearly renewal for letter + data,
Wilder and staff available for questions, limited brokerage
services available
Delta is not a trading system as much as it is an indicator. Using a
proprietary method, it picks future market turning points; part of its
accuracy in these points comes from an underlying regularity or repetition in
groups of these turning points. It has several different time frames for
turns, from a very short term series through a series that lasts for years.
When plotting points on historical charts to demonstrate Delta, you will be
amazed right out of your socks. Turning points really do occur where Delta
suggests that they should, or at least pretty close most of the time. There
are a few misses, but nothing major. Just for fun, you can predict future
market turns on paper, and as time goes by you can see how they match up. But
try to trade Delta as a standalone indicator (which is NOT recommended by
DSI, by the way), and you will lose, lose, lose.
But...if it's so accurate, how come it doesn't work for trading? Delta is
what I call a "historical accuracy" system. If you have a chart in front of
you, your eyes and your brain pick out the minor and major highs and lows.
When you map the turning points onto a completed chart, you gloss over the
"plus or minus" inaccuracies. Sometimes, the inaccuracies are very
significant, amounting to weeks early or late, but those are noted from an
omniscient point of view.
When you try to actually trade, you don't have the luxury of a completed
chart. You need to decide what to do based on only the present and past part
of the chart; your sense of all-knowing is gone. If you place a trade today,
seeing what you believe to be evidence of a reversal, would it matter that
the market top is actually weeks away? Sure as shootin', it would.
There is also the little matter of what Welles calls an "inversion window",
in which the market is allowed to flex and sort itself out before proceeding
with the rest of the turning points. This period of potential chaos is part
of what allows the rest of the turning points to be accurate. Sometimes the
turning points are clear right as you exit the window, and sometimes the
sequence isn't determined until most of the way through the series. On a
historical chart, you fudge the points until they fit. In real time, a
sequence isn't particularly effective for trading if you don't know how to
apply it until it's nearly over.
So, is it useless? Not totally. If you have something that is pretty good at
predicting reversal entry points, then Delta can be used as a confirming
indicator. On the other hand, if you have a good reversal system, I'm not
sure why you'd need to buy another confirming indicator.
Given some mechanical inconsistencies I've found in the system's
implementation (which I can't go into here without discussing the system
itself), and given the price being asked versus the value you really get, I'm
not pleased with the money that was spent for it. If the whole thing were
disclosed in the book that you buy, then I'd call it pricey but possibly
worthwhile. To have to fork out four figures to get the actual solutions
makes it way overpriced.
Thanks for reading.
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