Chapter One: What is the Adam Theory?
The Adam Theory is about achieving profits in the market... the principles of profiting in any free market worldwide. The Adam Theory guides you to observe the market in a unique way and instructs you to engage in market operations using a relatively distinctive method. It is the purest, simplest, and easiest method to apply for profiting in market operations... using only the information revealed by the market itself.
The role of the Adam Theory goes beyond this. It also informs traders of the most likely direction the market will take in the future. By employing the predictive techniques of the Adam Theory, traders can estimate and clearly see the path ahead. Then, traders can ask themselves, "Do I want to enter the market?" If the answer is affirmative, they should enter immediately.
The Adam Theory can be applied to any time frame. That is, it can be used on monthly, weekly, daily, or intraday charts. It is a theory based on visual reactions, and a simple candlestick chart can make it very clear without the need for mathematics.
Now, using candlestick charts, return to the question, "Do you want to trade?" If the answer is affirmative, the trader enters the market. The next day, the trader applies the Adam Theory again to discern the most likely path of the market and asks, "Do I still want to trade?" Eventually, the answer will be "no," and the Adam Theory will guide you to exit the market.
When performing the above tasks, the Adam Theory only observes the information revealed by the market itself... never making arbitrary judgments. The Adam Theory is the simplest and purest concept... yet most traders overlook it.
As J. Welles Wilder Jr. stated:
"The Adam Theory is concerned with this question: What are the fundamental principles for profiting in the market?
Or, in other words, how does the Adam Theory complete the following sentence: To succeed in the market, we must ______?
Are there common principles that traders, whether intentionally or unintentionally, apply to win in the market?"
"Please note that theories about how markets operate and develop are different from profiting in the market. The Adam Theory does not primarily discuss the market or how it operates but rather the secret to succeeding in the market. This is a distinction.
The greater the secret, the simpler it is—this is a reasonable statement. This is why the Adam Theory is often overlooked: because it is too simple. The human mind is extremely fond of complexity and difficulty; it likes to challenge itself. As a result, the mind often fails to grasp simple things, asking, 'Is this a great truth? How can it be so absurdly simple?'
The Adam Theory addresses the fundamental truth of things, discussing only what happens. It does not seem novel or complex, but that is its strength. Please note that the Adam Theory does not discuss what should happen or what is impressive. It focuses on one thing only—what truly, factually happens. Everything is simple and not at all difficult to understand.
When thinking about the Adam Theory, the only concern is one thing—what happens? Anything else may be interesting, but it is not important."
