Understanding Gann's Studies
Guessing the future is impossible, right? If you were present today, W.D. Gann would not be in consensus. His first prophecy is considered to have taken place throughout the First World War, once he predicted the abdication of Kaiser Wilhelm II of Germany on November 9, 1918 and the end of the war. Later, in 1927, he wrote a book called "Tunnel Through The Air" that several believe predicted the Japanese attack on Pearl Harbor.
His financial predictions were perhaps even deeper. In early 1929, he predicted that markets would likely continue to rally thanks to speculation and hit new highs… until early April. In his daily financial publication, The Supply and Demand Letter, he provided financial forecasts focused on the stock and commodity markets. While this publication gained notoriety, Gann published several books, among which "Truth" stands out, which has been hailed by The Wall Street Journal as his best work. In the end, he began to disseminate the techniques he used to make such predictions: the Gann studies.
What are the Gann studies?
In 1908, Gann found what he called the "time element of the market," which has made him one of the pioneers of technical study. To test his new tactic, he opened an account with $ 300 and another with $ 150. It turned out to be a huge win: Gann has been able to make $ 25,000 in profit with his $ 300 account in just 3 months; As both, he made a profit of $ 12,000 on his $ 150 account in just 30 days! When his results were verified, he was successful on Wall Street as one of the greatest forecasters of all time.
This is how his techniques work. Gann based the predictions of cost movements on 3 premises:
• Cost, era, and rank are the only 3 components to consider.
• Markets are cyclical in nature.
• Markets are geometric in design and functionality.
Based on these 3 premises, Gann's tactics revolved around 3 general zones of prediction:
• Cost analysis: use support and resistance lines, pivot points of view and angles.
• Time analysis: examines historically ordinary dates, derived by natural and social means.
• Pattern Analysis - Examine market changes using trend lines and reversal patterns.
Constructing Gann angles
Before starting, it is essential to note that this type of study, like most forms of technical study, is not written in its entirety. Without further ado, here is the process used to build a Gann angle:
Decide the units of time: this belongs to empirical processes. A common way to establish a time unit is to learn the action chart and take note of the distances over which cost movements occur. Then simply test the angles and determine their accuracy. Most individuals use intermediate-term charts (such as one to 3 months) for this, rather than long-term (multi-year) or short-term (one to 7 days) charts. This is because, in general, the intermediate term charts generate the optimal portion of patterns.
Determine the highest or lowest from which to draw the Gann lines: This is the second experimental process and the most common way to achieve this is to use other ways of technical study, such as Fibonacci levels or pivot points of view. Gann himself, however, used what he called "vibrations" or "cost swings." He concluded them by analyzing graphs using mathematical theories like Fibonacci.
Determine which boss to use: the two most common patterns are 1x1, 1x2, and 2x1. These are simply variations in the slope of the line. For example, the 1x2 is half the slope of the 1x1. The numbers simply refer to the number of units.
Draw the patterns: the direction could be down and to the right from a high point, or up and to the right from a low point.
Look for repeating patterns further down the chart - Remember that this technique is based on the assumption that markets are cyclical.
Again, this needs some experiential adjustments to improve. Thanks to this, the results will vary from one person to another. Several people, like Gann, will experience extraordinary success, while others, who do not use such refined techniques, will experience inferior returns. However, if you follow the system and do enough research to find the optimal requirements, you should achieve better-than-average performances. Remember, technical study is a game of probabilities: add more technical indicators to increase your chances of a successful trade.
Gann square
This article examines the negotiation procedures developed by W.D. Gann, a merchant with an extraordinary personality. He created a new approach to forecasting market behavior using some disciplines, including geometry, astrology, astronomy, and old mathematics. They claim that shortly before his death, Gann developed an exclusive trading system. However, he preferred not to make his invention public or share it with anyone.
What is peculiar about these procedures is that they involve the investigation of mathematical patterns and the detection of financial market cycles. Gann is the first to spot repeated cost cycles, and finding the cost-time relationship can help you examine the market and make calculations more immediately and simply.
What is the Square of 9?
Gann Square includes two sets of numbers. The first set is also called a wheel. In it, the numbers are available in the form of a spiral, and their values are available in a clockwise direction. Each number represents an angle with respect to the center. In the second set, the numbers are available on a plane. The classic square of 9 comes in two types:
• Diagonal.
• Cyclical.
How to construct the cyclic square of 9
The number increases as we move clockwise from the center. To do a full rotation, we need to make a 360 degree circle moving from one cell to another.
Odd-numbered squares can be found in the lower left corner of each rotation circle (3 × 3 = 9, 5 × 5 = 25, 7 × 7 = 49, 9 × 9 = 81, 11 × 11 = 121, 13 × 13 = 169, etc.). That's why the Gann Square is called the Square of 9: if you do a full rotation, you will get 9 (three squared).
The squares of the even numbers lie on the right preeminent diagonal at 315 ° (2 × 2 = 4, 4 × 4 = 16, 6 × 6 = 36, 8 × 8 = 64, 10 × 10 = 100, 12 × 12 = 144, etc.). If you see a high / low in one of these cells, there is a high possibility that the same formation (or its reflection in the mirror) will be repeated in one rotation. This rule also applies to odd-numbered squares.
Now let's inspect the preeminent left and bottom right diagonal lines. These lines represent half a circle of rotation once we go from odd-numbered squares to even-numbered squares (preeminent left diagonal) and from even-numbered squares to odd-numbered squares (lower right diagonal). Sound confusing enough? Let's break it down by taking an example. We go from the square of an even number to the square of an odd number, p. Eg from 16 to 25. We do the calculations: (16 + 25) /2=20.5. The problem with fractional numbers is that there is a high possibility of error. Everything is dependent on your accuracy and concentration. Now we move from the square of an odd number to the square of an even number, p. Eg from 121 to 144. Again, we do the calculations: (121 + 144) /2=132.5. As you may have noticed, our own calculated numbers have the possibility of finding around the diagonal lines at 225 °, 315 °, 45 °, and 135 °.
Now let's move from the square of an even number to the square of an odd number, p. Eg from 64 to 81. We will make 3 stops on our way: ¼ circle - 64+ (81-44) /4=68.25; ½ of a circle - 72; ¾ of a circle - 64+ (81-64) /4tz3=76.75. If we make a full rotation, we land at 81. As a consequence, our Square of 9 will look like this:
Note that fractional numbers can fall not only in the center of a cell, but also between cells.
Let's take a look at what we have. We change from a cyclic Gann square to a diagonal, adjusting it for a more detailed analysis of the graph. Now our Square of 9 consists of crosses:
The diagonal cross consists of odd-numbered squares and cells that are close to the even-numbered squares. The cardinal cross includes numbers close to ¼ and ¾ of a circle of rotation. By placing the initial value (high / low price) in the center of the square, you will be able to predict significant market events long before they occur. This method of price prediction is suitable for both long-term and short-term trading. At the same time, it is important to remember that using fundamental analysis is always a better idea than using technical tools, no matter how accurate they are.
Overlap
Anglos. You can rotate the angles according to the market situation and your goals;
Triangle. Although triangles give basically the same values as angles, for certain operators they are simpler to count than angles. If you are using the Gannzilla program, you will have no trouble drawing triangles and angles on your square.
Quadrilateral. When overlaying a geometric shape on a 9 square, you can use both the degree circle and the cell centers for orientation. In the image below, we superimposed a quadrilateral using each of these methods. As you can see, the images look identical, but they have different orientation systems. In the first image, we use cell 117 as an orientation. Although you can also use degrees. For it .
Pivot points
Now let's analyze the graph. First, we need to identify the pivot points. We will use these pivot points to predict where those pivot points may occur in the future based on current price fluctuations. It is important to understand that the market situation cannot change in a moment. The big players are entering the market slowly, one by one. This is why the market can still follow some of its previous patterns. According to William Gann, the best indicator of price behavior is how it has performed in the recent past.
How to calculate the square of 9
Now that we have the basic idea of the Square of 9, we need to learn to use our knowledge in real life. We need to see what these numbers mean in terms of negotiation. You can choose from 6 calculation methods using:
- Cell numbers;
- Overlay and cell numbers;
- Overlap and two pivot dates;
- Progression;
- Progression and overlap;
- Regression and superposition.
Since price and time are calculated separately, we get a total of 12 calculation methods. Also, if we use two types of time (continuous and discontinuous), we end up with 24 methods! We typically use discontinuous time (when only business days are taken into account) in Square 9's calculations, while continuous time is used for long-term projects (more than 1 year). For convenience, we will use the discontinuous tense in this article.
How to Calculate Gann Angle for Medium Term Trading
According to Gann, different trading tools move differently and have unique characteristics. However, all of them aim to reach a certain value. If we apply this information to the Square of 9, we will see that the prices and dates of the pivot points are arranged along a certain angle on the wheel. Sometimes there can be two of those angles.
Let's take an example. Suppose there was a downtrend that reversed into an uptrend. On a chart, we plot four points that mark the first vibration at the beginning of a trend. The X coordinates of these points represent time. The Y coordinates of these points represent the price. With these eight values, we will try to predict how a price will behave in the future. Let's list the points. Usually point 1 is used as the origin; Point 2 is used as an orientation; Points 3 and 4 are used for the angles. Then we draw the Gann Square and mark the points on it. Point 1 is in the center. Point 2, which is higher than point 1, lands in cell 19. Since the first Point 1 to 2 is 190d, Point three to 25 because it lasted 250d. Point 4. At 41. Because it lasted 410d. If we realize, each Maximum, It extends much more. Then.
The next step is to choose a geometric shape to place on the square. This shape will go through point 3 or point 4. Let's take a triangle. If you can't find the geometric shape that would go through Point 3 or Point 4, you must have incorrect points.
Based on this. We realize that we are inside the Cardinal Cross. Based on this. The current situation, be on the rise. Or low, it could last 490-710 days. Up to a maximum of 810 days. Following the square (Three squared), mostly the right side is the most expected (710d). Since it reflects time.
Example:
Sadly in tradingview you cannot use this mode, but we can use the gann box more easily. Let's see another way to use it. Simply with Angles. Which we already explained previously. Really the Box of Box, has a lot of data between itself, but to master this subject, you must deepen it. And for sure. This has its reality. Check the proportionality of the duration and see if it is consistent that the current zone lasts more than 700 days. They will be amazed. Personally I ignore the complicated theory, I rely on Angles.
My boxed configuration of Box is:
1.
0.
0.5.
The rest are values set to 0. And if you want to practice the complex box. Look for a software, since so far no platform offers it according to what I know.
Guessing the future is impossible, right? If you were present today, W.D. Gann would not be in consensus. His first prophecy is considered to have taken place throughout the First World War, once he predicted the abdication of Kaiser Wilhelm II of Germany on November 9, 1918 and the end of the war. Later, in 1927, he wrote a book called "Tunnel Through The Air" that several believe predicted the Japanese attack on Pearl Harbor.
His financial predictions were perhaps even deeper. In early 1929, he predicted that markets would likely continue to rally thanks to speculation and hit new highs… until early April. In his daily financial publication, The Supply and Demand Letter, he provided financial forecasts focused on the stock and commodity markets. While this publication gained notoriety, Gann published several books, among which "Truth" stands out, which has been hailed by The Wall Street Journal as his best work. In the end, he began to disseminate the techniques he used to make such predictions: the Gann studies.
What are the Gann studies?
In 1908, Gann found what he called the "time element of the market," which has made him one of the pioneers of technical study. To test his new tactic, he opened an account with $ 300 and another with $ 150. It turned out to be a huge win: Gann has been able to make $ 25,000 in profit with his $ 300 account in just 3 months; As both, he made a profit of $ 12,000 on his $ 150 account in just 30 days! When his results were verified, he was successful on Wall Street as one of the greatest forecasters of all time.
This is how his techniques work. Gann based the predictions of cost movements on 3 premises:
• Cost, era, and rank are the only 3 components to consider.
• Markets are cyclical in nature.
• Markets are geometric in design and functionality.
Based on these 3 premises, Gann's tactics revolved around 3 general zones of prediction:
• Cost analysis: use support and resistance lines, pivot points of view and angles.
• Time analysis: examines historically ordinary dates, derived by natural and social means.
• Pattern Analysis - Examine market changes using trend lines and reversal patterns.
Constructing Gann angles
Before starting, it is essential to note that this type of study, like most forms of technical study, is not written in its entirety. Without further ado, here is the process used to build a Gann angle:
Decide the units of time: this belongs to empirical processes. A common way to establish a time unit is to learn the action chart and take note of the distances over which cost movements occur. Then simply test the angles and determine their accuracy. Most individuals use intermediate-term charts (such as one to 3 months) for this, rather than long-term (multi-year) or short-term (one to 7 days) charts. This is because, in general, the intermediate term charts generate the optimal portion of patterns.
Determine the highest or lowest from which to draw the Gann lines: This is the second experimental process and the most common way to achieve this is to use other ways of technical study, such as Fibonacci levels or pivot points of view. Gann himself, however, used what he called "vibrations" or "cost swings." He concluded them by analyzing graphs using mathematical theories like Fibonacci.
Determine which boss to use: the two most common patterns are 1x1, 1x2, and 2x1. These are simply variations in the slope of the line. For example, the 1x2 is half the slope of the 1x1. The numbers simply refer to the number of units.
Draw the patterns: the direction could be down and to the right from a high point, or up and to the right from a low point.
Look for repeating patterns further down the chart - Remember that this technique is based on the assumption that markets are cyclical.
Again, this needs some experiential adjustments to improve. Thanks to this, the results will vary from one person to another. Several people, like Gann, will experience extraordinary success, while others, who do not use such refined techniques, will experience inferior returns. However, if you follow the system and do enough research to find the optimal requirements, you should achieve better-than-average performances. Remember, technical study is a game of probabilities: add more technical indicators to increase your chances of a successful trade.
Gann square
This article examines the negotiation procedures developed by W.D. Gann, a merchant with an extraordinary personality. He created a new approach to forecasting market behavior using some disciplines, including geometry, astrology, astronomy, and old mathematics. They claim that shortly before his death, Gann developed an exclusive trading system. However, he preferred not to make his invention public or share it with anyone.
What is peculiar about these procedures is that they involve the investigation of mathematical patterns and the detection of financial market cycles. Gann is the first to spot repeated cost cycles, and finding the cost-time relationship can help you examine the market and make calculations more immediately and simply.
What is the Square of 9?
Gann Square includes two sets of numbers. The first set is also called a wheel. In it, the numbers are available in the form of a spiral, and their values are available in a clockwise direction. Each number represents an angle with respect to the center. In the second set, the numbers are available on a plane. The classic square of 9 comes in two types:
• Diagonal.
• Cyclical.
How to construct the cyclic square of 9
The number increases as we move clockwise from the center. To do a full rotation, we need to make a 360 degree circle moving from one cell to another.
Odd-numbered squares can be found in the lower left corner of each rotation circle (3 × 3 = 9, 5 × 5 = 25, 7 × 7 = 49, 9 × 9 = 81, 11 × 11 = 121, 13 × 13 = 169, etc.). That's why the Gann Square is called the Square of 9: if you do a full rotation, you will get 9 (three squared).
The squares of the even numbers lie on the right preeminent diagonal at 315 ° (2 × 2 = 4, 4 × 4 = 16, 6 × 6 = 36, 8 × 8 = 64, 10 × 10 = 100, 12 × 12 = 144, etc.). If you see a high / low in one of these cells, there is a high possibility that the same formation (or its reflection in the mirror) will be repeated in one rotation. This rule also applies to odd-numbered squares.
Now let's inspect the preeminent left and bottom right diagonal lines. These lines represent half a circle of rotation once we go from odd-numbered squares to even-numbered squares (preeminent left diagonal) and from even-numbered squares to odd-numbered squares (lower right diagonal). Sound confusing enough? Let's break it down by taking an example. We go from the square of an even number to the square of an odd number, p. Eg from 16 to 25. We do the calculations: (16 + 25) /2=20.5. The problem with fractional numbers is that there is a high possibility of error. Everything is dependent on your accuracy and concentration. Now we move from the square of an odd number to the square of an even number, p. Eg from 121 to 144. Again, we do the calculations: (121 + 144) /2=132.5. As you may have noticed, our own calculated numbers have the possibility of finding around the diagonal lines at 225 °, 315 °, 45 °, and 135 °.
Now let's move from the square of an even number to the square of an odd number, p. Eg from 64 to 81. We will make 3 stops on our way: ¼ circle - 64+ (81-44) /4=68.25; ½ of a circle - 72; ¾ of a circle - 64+ (81-64) /4tz3=76.75. If we make a full rotation, we land at 81. As a consequence, our Square of 9 will look like this:
Note that fractional numbers can fall not only in the center of a cell, but also between cells.
Let's take a look at what we have. We change from a cyclic Gann square to a diagonal, adjusting it for a more detailed analysis of the graph. Now our Square of 9 consists of crosses:
The diagonal cross consists of odd-numbered squares and cells that are close to the even-numbered squares. The cardinal cross includes numbers close to ¼ and ¾ of a circle of rotation. By placing the initial value (high / low price) in the center of the square, you will be able to predict significant market events long before they occur. This method of price prediction is suitable for both long-term and short-term trading. At the same time, it is important to remember that using fundamental analysis is always a better idea than using technical tools, no matter how accurate they are.
Overlap
Anglos. You can rotate the angles according to the market situation and your goals;
Triangle. Although triangles give basically the same values as angles, for certain operators they are simpler to count than angles. If you are using the Gannzilla program, you will have no trouble drawing triangles and angles on your square.
Quadrilateral. When overlaying a geometric shape on a 9 square, you can use both the degree circle and the cell centers for orientation. In the image below, we superimposed a quadrilateral using each of these methods. As you can see, the images look identical, but they have different orientation systems. In the first image, we use cell 117 as an orientation. Although you can also use degrees. For it .
Pivot points
Now let's analyze the graph. First, we need to identify the pivot points. We will use these pivot points to predict where those pivot points may occur in the future based on current price fluctuations. It is important to understand that the market situation cannot change in a moment. The big players are entering the market slowly, one by one. This is why the market can still follow some of its previous patterns. According to William Gann, the best indicator of price behavior is how it has performed in the recent past.
How to calculate the square of 9
Now that we have the basic idea of the Square of 9, we need to learn to use our knowledge in real life. We need to see what these numbers mean in terms of negotiation. You can choose from 6 calculation methods using:
- Cell numbers;
- Overlay and cell numbers;
- Overlap and two pivot dates;
- Progression;
- Progression and overlap;
- Regression and superposition.
Since price and time are calculated separately, we get a total of 12 calculation methods. Also, if we use two types of time (continuous and discontinuous), we end up with 24 methods! We typically use discontinuous time (when only business days are taken into account) in Square 9's calculations, while continuous time is used for long-term projects (more than 1 year). For convenience, we will use the discontinuous tense in this article.
How to Calculate Gann Angle for Medium Term Trading
According to Gann, different trading tools move differently and have unique characteristics. However, all of them aim to reach a certain value. If we apply this information to the Square of 9, we will see that the prices and dates of the pivot points are arranged along a certain angle on the wheel. Sometimes there can be two of those angles.
Let's take an example. Suppose there was a downtrend that reversed into an uptrend. On a chart, we plot four points that mark the first vibration at the beginning of a trend. The X coordinates of these points represent time. The Y coordinates of these points represent the price. With these eight values, we will try to predict how a price will behave in the future. Let's list the points. Usually point 1 is used as the origin; Point 2 is used as an orientation; Points 3 and 4 are used for the angles. Then we draw the Gann Square and mark the points on it. Point 1 is in the center. Point 2, which is higher than point 1, lands in cell 19. Since the first Point 1 to 2 is 190d, Point three to 25 because it lasted 250d. Point 4. At 41. Because it lasted 410d. If we realize, each Maximum, It extends much more. Then.
The next step is to choose a geometric shape to place on the square. This shape will go through point 3 or point 4. Let's take a triangle. If you can't find the geometric shape that would go through Point 3 or Point 4, you must have incorrect points.
Based on this. We realize that we are inside the Cardinal Cross. Based on this. The current situation, be on the rise. Or low, it could last 490-710 days. Up to a maximum of 810 days. Following the square (Three squared), mostly the right side is the most expected (710d). Since it reflects time.
Example:
Sadly in tradingview you cannot use this mode, but we can use the gann box more easily. Let's see another way to use it. Simply with Angles. Which we already explained previously. Really the Box of Box, has a lot of data between itself, but to master this subject, you must deepen it. And for sure. This has its reality. Check the proportionality of the duration and see if it is consistent that the current zone lasts more than 700 days. They will be amazed. Personally I ignore the complicated theory, I rely on Angles.
My boxed configuration of Box is:
1.
0.
0.5.
The rest are values set to 0. And if you want to practice the complex box. Look for a software, since so far no platform offers it according to what I know.