Gann was also known for his use of time cycles, which he believed could be used to predict market movements. He believed that certain market events, such as the high and low prices of a stock or commodity, could be predicted using time cycles. Gann astrology has found its application in real-world trading circumstances where specific astrological events provide an additional layer to strategy development.
For instance, if a trader receives a margin call, he should close the position immediately, for the chances are he is wrong. He also taught that a successful trader studies human nature and does the opposite of what the general public does. Most traders lose money because they are too greedy, they over trade, they expect abnormal profits in normal markets.
Trades on both methods usually result in durations of a few hours to a couple weeks. Ideally there is a trade working at most times which is considered a ‘runner,’ or longer running trade than the first lot. The Mechanical Method labelled ‘Basic’ in these panels is the basic method Gann first describes and gives example trades of. The column ‘Safest’ was the method where Gann added pullback buying, multiple signal entry, and further safeguards which qualified entries. Gann placed extreme importance on squaring between price ranges, these could be retracement levels or alternating campaigns.
- Fusing together mathematical rigor with an intimate knowledge of market timing, Gann’s approach revolutionized the way traders forecast and capitalize on market movements.
- By blending financial expertise with astrological insights, W.D.
- Dedicated to studies and the expansion of his knowledge, Gann invested years reviewing records found in the Astor Library in New York, and in the British Museum of London, some going back as far as 1820.
- If we continue going through the days one by one, we’ll see that, between April 19 and 20, Mercury changes the direction and starts going clockwise again.
- They are widely seen as innovative and still studied and used by traders today.
- Now in 1996 I feel I have finally produced a tool that gives me total control over my own trading destiny.
The Gann Square: A Window into Market Cycles
In perfection, you need an instrument with long trading history in daily charts. Today, I’ll start with specific planet combinations and their influence on price action of different trading instruments. The main advantage of this method is that it is compatible with any trading strategy for middle-term and long-term trading. For a more detailed analysis, I need to study other Gann levels, identified earlier by means of other methods. Next, I go on updating the chart daily and monitor the ticker movements in relation to the levels identified. If you scroll the cosmogram calendar forward, you can see that this motion ends on February 21.
Having an open mind and grasping the key concept that the past, present, and future all exist at the same time on a Gann angle can help you analyze and trade a market with more accuracy. Learning the characteristics of the different markets regarding volatility, price scale, and how markets move within the Gann angle framework will help improve your analytical skills. Because of the relative ease traders today have at placing Gann angles on charts, many traders do not feel the need to actually explore when, how, and why to use them.
How to combine Gann tools?
- Optuma GannTrader brings you the Gann Swing Chart, Point Swing Chart, and Percent Swing Chart.
- Moreover, 34% of all signals resulted in trend reversal and only 36% of all signals were bullish.
- The power of geometry in finance can be vividly observed through the gann angles, a cornerstone method of W.D.
- Most people do not realize how easy it is to identify time cycles in advance.
- This rule states that when the market breaks one angle, it will move toward the next one.
- Historically, I draw my charts fro analysis according to the time zone of UTC + 3, which corresponds to Moscow local time.
The All Ordinaries Index between 1991 and 1994 is a perfect example of squaring between price ranges. It is important to realize that the Earth takes 179 days to move from 0o to 180o around the Sun. Yet, it takes 186 days to move from 180o to 360o around the Sun. The two points in the circle, of one year, where the relationships between days and degrees begin speeding up and slowing down are the perigee and the apogee.
Key Takeaways
Finally, I analyzed the market response to the positions of the suggested above planets and their different Aspects. The longer trading history you study, the wider is the selection, the more relevant will be your analysis. Finally, I’ll have statistics that will clearly show which of the planet pairs and in which Aspect has the strongest influence on the market and in which direction. That is, there are 80 possible combinations of different celestial bodies in total. I continue one of the most enigmatic and mysterious topics in the Gann’s works and, perhaps in all the studies devoted to trading, is the use of cosmogram and Square of 9.
Plot significant market highs and lows, and measure the time between them. These time cycles will give you a sense of when the market is likely to shift direction again. I want to emphasize that, according to this method, there are no concepts like long-term or short-term forecasts. You operate only with historical data in the daily timeframe. You see from the chart above that the longitude of the square and the triangle angles to Venus is constantly increasing, following the planet motion.
W.D. Gann’s journey from a simple origin to becoming a luminary in the world of finance is nothing short of remarkable. His aptitude for numbers and an uncanny understanding of market principles led him to develop what is known today as gann theory—a beacon of predictive accuracy in trading circles. The Gann Square of Nine threads through the tapestry of technical analysis, offering a roadmap for those who aim to navigate the ever-changing cinema of financial markets. Gann gave the ‘Basic’ method to traders who has less access to market data and wanted fewer trades.
Gann Charts in Optuma
I finally made about 139 records, which are of course not that numerous, but still sufficient to draw certain conclusions and find out specific combinations of planets. I set the beginning of last year as the starting point in the cosmogram. Gann believed these three combinations to be the key ones for any type of the market. For example, when crossing the equator, i.e. 180 degrees, the opposite angle will create in the chart a new point with the size of one degree or 52.33 https://traderoom.info/ganns-methods/ USD. To choose another extreme, the perfect will be the one, marked at the levels, identified by means of the planet with long orbit. In order to fully apply this method starting from January 6, when I identified the first extreme, I also need to find out the closest planets with short orbits, such as Mercury, Venus and Mars.
First, I’ll describe the alternative way to identify key dates by means of Chronometer, the circle that surrounds Square of 9. However, having done such a job one, you won’t have to do it again; the most diligent traders may like this method. On the other hand, there is no particular pair of planets that will send a certain type of signals, so the signals of Squares should be the most reliable. I noticed that the planet conjunction is in general a positive signal for BTCUSD, which in most cases results in a bullish reversal. I must say that one of the most distinct Aspects is the Conjunction of two planets. At its time, in 42 cases out of 100 the trend reverses and a new wave starts.
By understanding an asset’s natural vibration, you can predict its price direction. Empower yourself with a holistic approach that blends the wisdom of the stars with technical analysis for more confident and profitable trading decisions. The author Sankar Srinivasan is a Certified market professional of National stock exchange of India. To exploit this method most efficiently, I recommend combining it with other Gann’s trading methods, including those, described in the previous articles. In the next post, I’ll move away from mathematics and write about the stars. I’ll describe how Gann used astrology in his studies and try to apply it in practice.