J. Welles Wilder

J. Welles Wilder Jr. (1935–2021): the mechanical engineer who, in a single book (1978), handed trading the RSI, ATR, ADX and Parabolic SAR — the most-used single contribution in the history of indicators.

On this page

New Concepts in Technical Trading Systems (1978): no other book has put so many permanent tools on the platforms of the entire world.

Period 1935 – 2021
Background Mechanical engineering; then real estate and commodities
Lens Mechanical systems on commodities
Key work New Concepts in Technical Trading Systems (1978)

Who he was

Portrait — J. Welles Wilder

A mechanical engineer who moved first into real estate and then into commodity markets, Wilder approached trading as an engineering problem: define, measure, systematise. In 1978 he self-published a spiral-bound volume full of tables to fill in by hand with a calculator: inside, already complete, were four of the most-used tools half a century later. Our indicators module owes him an entire family.

Contribution

Four tools from the same book, each with its own entry in the catalogue:

Tool The question it answers
RSI How strong is the push?
ATR How much does it really move, wicks included?
ADX (with +DI/−DI) Is there a trend, or not?
Parabolic SAR Where do I keep the stop while the trend runs?

Plus Wilder's smoothing (the slow average that bears his name), used inside RSI, ATR and ADX: the technical signature of the whole family.

What today's students learn from him

  1. Design, don't improvise — each of his tools starts from one precise question and answers only that: the opposite of the do-everything indicator.
  2. The tools were born together as a system: the ADX says whether there is a trend, the SAR manages the stop inside it, the ATR sizes it, the RSI measures the push. Studying them separately loses the overall design.
  3. Robust simplicity ages well: 1978 formulas computable by hand still ship as standard on every platform on the planet.

Study path

The four entries of the indicators module are, in effect, his path:

Start with the RSI →