Crude Oil Outlook: Key Levels Shape the Path AheadHello Traders,
Trust you are doing great.
Please take some moment to go through my analysis of USOIL and share your thoughts.
Overview
USOIL is currently trading at 70.08, with mixed trends across timeframes. On the H4 chart, the pair remains bullish, recovering from a recent correction. Meanwhile, the H1 chart shows a bearish trend in a corrective phase, with resistance emerging in the 70.19–70.90 region.
Idea
An impulsive rally from 67.045 on December 5th corrected to the 0.5 Fibonacci retracement level at 68.78 on December 13th, where support was established. This led to a bounce toward 70.19-70.21, which now acts as resistance.
If this resistance holds, a downward move is expected, targeting 67.70 and 67.08, areas where a bullish bounce may likely occur. The short-term bias remains bearish unless price breaches the Friday high of 71.38, which would shift focus to the 71.66–72.21 zone as a potential turning point.
Conclusion
In the short term, the bearish outlook is dominant, with 71.38 as the key invalidation level and a stop-loss reference. A break below 69.65 would add confidence to the bearish scenario, while any move above 71.38 could signal further upside, targeting the 71.66–72.21 zone for a potential reversal.
Cheers! Merry Christmas and Happy New Year in advance.
Gannlevels
The Nifty Spot Intraday trend forecast for December 16, 2024Here is the Nifty intraday likely trend for December 16, 2024. The trend looks bearish during the day. There is a possibility of Gap up opening. The intraday levels provided in the graph may vary subject to Gaps on the either side. This information is only for educational purposes.
10 Brutal Truths About Why Retail Support & Resistance Fail !CAPITALCOM:GOLD
10 Reasons Why Retail Support and Resistance Levels Fail: Unlocking Gann’s Secrets to Market Mastery
Here’s a deeply researched, professional explanation for each point, infused with Gann’s quotes, examples, and concepts, to open the eyes of traders to why retail methods often fail and how Gann's wisdom provides clarity.
1. Static Levels in a Dynamic Market -
Explanation: Retail traders often draw support and resistance (S/R) lines as static horizontal levels, expecting the market to repeatedly respect them. However, Gann emphasized the dynamic nature of markets, stating:
"Markets are never still; they are always moving, reflecting time and price interplay."
Markets are influenced by cycles, trends, and time frames, making S/R levels fluid rather than fixed. For instance, Gann’s Square of Nine shows how support and resistance rotate based on angles and time increments, offering precise levels that adapt dynamically. Retail traders fail to adjust their levels as time progresses, missing key changes in price behavior.
2. Failure to Incorporate Time -
Explanation: Retail S/R methods typically ignore the role of time, which is a critical element in Gann's work. Gann wrote:
"Time is the most important factor in determining market movements."
Support may fail not because the level was invalid but because the "time factor" for that level has expired. For example, in Gann’s Time Cycles, support at a certain price might hold only for a specific duration. When that time passes, the level loses its relevance. Retail traders, unaware of such timing principles, are often blindsided when the market breaks their "strong" levels.
3. Lack of Confluence with Angles -
Explanation: Gann’s methodologies prioritize the confluence of price and angle relationships. He believed that price moves in harmony with geometric angles, stating:
"When price meets time at an angle, a change is imminent."
Retail traders fail to consider these angular relationships, focusing only on flat horizontal lines. For example, a 45° angle from a significant low often acts as a true support, but retail traders, relying solely on previous price zones, miss these powerful turning points.
4. Overcrowding and Psychological Herding -
Explanation: S/R levels widely used by retail traders often attract a large number of orders at the same price zone, making them predictable and vulnerable to institutional manipulation. Gann noted:
"The crowd is often wrong, and the minority drives the market."
Institutions exploit this herding by triggering stop-losses just below support or above resistance, creating false breakouts. For instance, Gann’s "Law of Vibration" explains how markets seek equilibrium by disrupting imbalances created by crowd psychology.
5. Ignoring Volume Analysis
Explanation: Retail traders rarely integrate volume into their S/R analysis. Gann emphasized the importance of volume, stating:
"Price movements must be confirmed by volume to validate strength."
Support may appear to hold, but without accompanying volume, the level lacks significance. A practical Gann-based example would involve observing increased volume near a critical angle or price zone, signaling genuine strength or weakness at that level.
6. Using Recent Highs/Lows Without Context -
Explanation: Many retail traders base S/R levels on recent highs and lows, assuming these are universally strong zones. Gann criticized such oversimplified approaches, writing:
"The past governs the future, but only through proper analysis of cycles and patterns."
Without analyzing historical patterns and cycles, these levels are often superficial. For example, Gann's Master Charts reveal that true resistance may lie at a harmonic distance from an earlier historical pivot, not necessarily at the recent high.
7. Misunderstanding False Breakouts -
Explanation: Retail traders often misinterpret false breakouts as failures of support or resistance. Gann explained this phenomenon through his price and time squares, stating:
"A breakout without harmony is often a trap, designed to mislead the majority."
For instance, a false breakout above resistance might align with a Gann angle signaling a reversal, confusing those relying solely on retail S/R levels.
8. Ignoring Market Structure and Trend -
Explanation: Retail traders often focus on S/R levels without understanding the broader market structure or trend. Gann believed:
"The trend is your friend until time signals the end."
Support is more likely to hold in an uptrend, while resistance is stronger in a downtrend. A classic Gann principle involves combining market structure with angular analysis to determine whether S/R levels will hold or break.
9. Failure to Account for Gann's Price Harmonies -
Explanation: Gann’s studies reveal that price moves in harmonic relationships, often tied to Fibonacci ratios and geometric principles. Retail traders using arbitrary S/R levels fail to respect these harmonies. For example, Gann's observation of price doubling or halving (e.g., $50 to $100) often defines true support or resistance.
10. Reliance on One-Timeframe Analysis -
Explanation:
Retail traders frequently analyze S/R on a single timeframe, missing the interplay between multiple timeframes. Gann emphasized multi-timeframe alignment, writing:
"The major trend governs the minor trend, and the minor trend refines the major."
Support on an hourly chart may fail if it conflicts with resistance on a daily chart. Gann’s multi-timeframe methods ensure alignment, reducing the likelihood of failure.
Updated Closing Thought-
By understanding the reasons why retail support and resistance often fail and incorporating Gann’s time-tested principles, traders can elevate their skills to a professional level. Gann's focus on time, price, and geometry provides a roadmap to understanding the market with unparalleled precision.
This content is invaluable for anyone seeking trading mastery, so don't keep it to yourself! Save this and share it with your friends so they can benefit too. Follow for more absolutely valuable and free trading insights!
GANN TRADING LESSON: TIME IS MORE IMPORTANT THAN PRICE GANN TRADING LESSON: TIME IS MORE IMPORTANT THAN PRICE – W.D. GANN’S METHODOLOGY - The principles of W.D. Gann's trading methodology continue to intrigue and challenge traders worldwide.
At the core of Gann's approach lies the harmonious relationship between price and time, encapsulated in his concept of "squaring."
This principle emphasizes balancing movements in price with corresponding movements in time, thus uncovering the rhythmic and periodic nature of the markets.
Understanding Time Balance in Trading
Gann emphasized the significance of time balance, which involves aligning the duration of a market movement with its magnitude.
This balance is critical because markets, according to Gann, inherently strive to return to a state of harmony, even after experiencing disharmonious phases.
Recognizing these patterns enables traders to anticipate turning points and identify optimal trading opportunities.
The Concept of the Initial Impulse
Gann’s methodology suggests that every market movement begins with an “initial impulse,” which sets the stage for subsequent trends.
This impulse, whether periodic or rhythmic, forms the foundation for future market behavior. Periodic movements repeat after fixed intervals, while rhythmic movements grow proportionally to the initial impulse.
Understanding and marking these impulses on price charts is a vital step in applying Gann’s techniques.
The Series 144 and Squaring Principles
Gann frequently referenced the significance of numerical series, particularly THE 144 SERIES . He argued that price movements often align with values derived from this sequence.
For instance, the duration of an initial impulse may correspond to one value in the series, while subsequent reactions adhere to multiples or subdivisions of this value.
Squaring, a cornerstone of Gann’s theory, involves matching price ranges with equivalent time periods. This can be applied in various forms:
Squaring the price range: Balancing the maximum and minimum price range over a specific time period.
Squaring the minimum price: Equating the duration of a move with its lowest price point.
Squaring the maximum price: Aligning the time elapsed with the highest price point.
Periodic and Rhythmic Movements
According to Gann, markets exhibit both periodic and rhythmic behaviors. Periodic movements repeat after a set number of time units, while rhythmic movements expand or contract in known proportions.
Identifying these characteristics is crucial for marking trends accurately and predicting future price action.
Key Considerations in Applying Gann’s Method
Inharmonious Market Behavior: Gann acknowledged that markets often deviate from ideal structures but emphasized that they ultimately revert to harmony. Recognizing these deviations and their eventual corrections is central to mastering his method.
Critical Points of Strength: Gann’s theory highlights the importance of key levels, such as 50% retracements, as points where price and time converge.
Templates and Extreme Values: Gann’s approach involves overlaying templates based on extreme highs and lows for specific time units (e.g., daily, weekly, monthly) to track market behavior accurately.
The Law of Vibration
Central to Gann’s teachings is the “Law of Vibration,” which posits that all market movements follow universal laws of motion and rhythm.
By studying the past and present, traders can predict future price action with remarkable precision. This principle underpins the repetitive nature of market trends and cycles, reinforcing Gann’s assertion that history repeats itself.
Gann’s Legacy
Gann’s work, often regarded as esoteric, challenges traders to elevate their understanding of market dynamics. His insights into the interplay of time and price continue to inspire new generations of traders to uncover the “Creator’s plan” in financial markets.
While applying his methods requires patience and meticulous study, the rewards are profound for those who master the art of balance and harmony in trading.
Conclusion
By embracing the principles of time balance, the initial impulse, numerical series, and the Law of Vibration, traders can uncover patterns and cycles that enhance their market predictions.
Although Gann’s techniques require dedication and a willingness to delve into intricate concepts, they offer profound insights for those who persevere. His legacy endures as a testament to the potential of blending analytical precision with universal principles, making his methods a timeless guide for mastering market rhythms.
Join the Discussion:
Do you agree with Gann that TIME is the most critical factor in trading? Share your thoughts and experiences below!
GANN TRADING LESSON - GANN BOX & TIME CYCLE 144GANN BOX & TIME CYCLE 144 are two pivotal tools introduced by W.D. Gann , a legendary figure in financial markets. These tools integrate time and price dynamics seamlessly, providing traders with revolutionary methods to analyze market movements.
Here, we’ll explore these tools and how traders can apply them to achieve greater precision and insight in their trading. Understanding the interplay between time and price is a cornerstone of effective trading.
What is Gann’s Box?
Gann’s Box is a synthetic coordinate system that enables traders to analyze price dynamics within structured time and price parameters. The box helps visualize patterns and understand the relationship between upward and downward movements over specific periods.
By using this tool, traders can:
Identify directional trends.
Recognize structural alternations of price movement.
Pinpoint significant turning points in the market.
Principles of the Gann Box
First Principle: Directional Price Movements
The Gann Box segments price movements into discrete directional sections. These sections reveal periods of trend continuation or reversal. By overlaying a box on the chart from a significant extremum, traders can observe how price respects its boundaries over time.
Second Principle: Structure of Movement
Markets alternate between upward and downward movements in a structured and often periodic manner. Gann’s Box allows traders to:
Detect these alternations.
Visualize corrections versus trend-directed movements.
Forecast future structural changes based on historical patterns.
Cycle 144: A Unique Trading Model
Gann’s Cycle 144 is an advanced application of the Gann Box. It involves a fixed time cycle of 144 units (e.g., hours, days, or any chosen timeframe) and is based on the following principles:
Begin at the Extremum: The cycle always starts at a key high or low.
End After 144 Units: The cycle concludes after 144 time units.
No Gaps Between Cycles: Models should seamlessly connect without gaps.
Overlapping Models: Multiple cycles can operate simultaneously, enhancing prediction accuracy within the same timeframe.
This model offers a comprehensive framework to predict market movements within defined intervals.
Practical Steps to Apply Gann’s Box
Identify Key Extremums
Locate significant highs or lows on your chart to serve as the starting points.
Construct the Gann Box
Use the chosen extremum to calculate the parameters of the box. Ensure alignment between price and time scales.
Analyze Trends and Corrections
Observe how price behaves within the box, identifying trend continuations, corrections, and potential reversals.
Incorporate Cycle 144
Overlay the Cycle 144 model to refine predictions, ensuring to account for overlapping cycles for greater precision.
Why Gann’s Box Matters for Traders
Gann’s Box is not just a tool but a framework for disciplined and informed trading. Here are its key benefits:
Accurate Forecasting: Pinpoint turning points with precision.
Structured Analysis: Analyze price action within a logical, visual framework.
Improved Decision-Making: Reduce emotional bias by relying on objective patterns.
Conclusion
Gann’s Box and Cycle 144 offer traders a methodical approach to deciphering market movements. By integrating TIME & PRICE , these tools simplify the complexities of trading while providing actionable insights.
As with any trading method, success lies in practice and observation. Study past market movements, experiment with Gann’s concepts, and refine your understanding. With dedication, these tools can transform your approach to trading and unlock new levels of mastery.
How I Execute Trades Using Gann’s Square of 9Here in this example, I have used the Square of 9 method to predict a potential market reversal and executions. W.D. Gann, a legendary trader and analyst, is renowned for his pioneering techniques in financial markets.
Among his tools, the Square of 9 stands out as a remarkable system to predict market turning points with precision. In this blog, we’ll explore the fundamentals of the Square of 9, how it works, and how we can use it to improve timing and decision-making in the markets.
What is the Square of 9?
The Square of 9 is a spiral-based numerical grid where numbers are arranged in a square, starting from 1 at the center and spiraling outward. Each number on the grid has angular relationships with other numbers, which Gann believed could forecast significant market movements.
For instance:
Numbers at the same angles (e.g., 39, 67, 105, 150) share a relationship that can signify potential turning points in the market.
By marking these numbers and aligning them with trading days, we can identify key dates for potential price reversals.
Core Assumptions in Price Dynamics
Gann’s methods rely on two key assumptions:
Repetition in Price and Time: Price tends to follow specific patterns or laws over defined intervals of time.
Structured Alternation: The up-and-down movements of price are not random; they alternate in a structured, periodic manner.
These assumptions form the foundation for analyzing price action through tools like the Square of 9.
How to Use the Square of 9
Step 1: Identify Key Market Extremes
Begin by locating significant highs or lows on a price chart. These extremums act as the starting point for your calculations.
Step 2: Calculate Calendar Days
Count the number of calendar days between:
Two highs,
Two lows, or
A high and a low.
Step 3: Locate the Number on the Square of 9
Find the calculated number (e.g., 39) on the Square of 9. Then, mark other numbers that lie on the same angle or corner, such as 67, 105, or 150.
Step 4: Predict Turning Points
Mark these numbers as potential future dates. On these dates, observe the market closely for signs of reversals or continuations.
Practical Example
Now let's Analyse GOLD. In this example we will take a daily candle that is making an all time high. From that high we will count the very next extreme high or low. How many trading days it takes to reach that price point and make a reversal? - 40 Trading days.
Now we will look for the number 40 in Gann square of 9 table. and the very next probable execution or reversal we will get after 70 days according to the table.
We see sharp price movement after 70th day and then at 180th day where we can place our order and execute with other confirmations.
Benefits of Using the Square of 9
Enhanced Timing: Pinpoint potential reversal dates, helping traders refine entry and exit strategies.
Objective Forecasting: Use a structured approach to reduce emotional decision-making.
Improved Accuracy: Combine the Square of 9 with other technical tools for more reliable predictions.
Conclusion
The Square of 9 is a powerful tool for traders who seek to integrate time and price analysis into their strategies. By understanding its mechanics and applying its principles, you can anticipate market turns with greater confidence.
As with any trading tool, practice and observation are essential. Study past market movements using the Square of 9 to develop your intuition and skill. With dedication, you’ll unlock the potential of this fascinating method and take your trading to the next level.
GANN TRADING LESSON - TIME IS MORE IMPORTANT THAN PRICETIME IS MORE IMPORTANT THAN PRICE: The Astrological Perspective Behind Gann’s Methodology
When William Delbert Gann emphasized that TIME is more important than PRICE, he was tapping into something much deeper than conventional market analysis. While many traders focus on price movements alone, Gann understood that the market operates in astronomical cycles, where TIME governs much more than just price fluctuations. Astrology—particularly the positions and movements of celestial bodies—played a pivotal role in shaping his market predictions.
In this lesson, I’ll explain how TIME, as influenced by astrology, is crucial to understanding market movements. These cycles, when understood properly, offer predictive power far beyond just analysing price levels.
Astrological Influence on Time:
1. Planetary Cycles and Market Behavior:
Gann didn’t just rely on conventional time intervals or geometric patterns. He utilized planetary alignments and aspects (the angular relationship between planets) to time his market entries and exits. Astrology is a tool that provides insights into the cycles of energy that influence all aspects of life, including financial markets.
- Saturn’s Influence: Saturn governs structure, discipline, and long-term cycles. Gann recognized Saturn’s influence in the market's periodic retracements and consolidations. Understanding the Saturn cycle (approximately 29.5 years) can offer insight into long-term market trends and reversals.
- Jupiter’s Influence: Jupiter represents expansion and growth. Its cycles (around 12 years) highlight moments of market optimism and bullish phases. A conjunction or favorable aspect of Jupiter can signal market rallies.
- Mars and Venus: The positions and aspects of Mars (action, aggression) and Venus (value, attraction) provide insights into the market’s volatility and emotional impulses. These planetary movements help explain rapid market changes, both bullish and bearish.
2.Timing the Market with Planetary Transits:
A planetary transit occurs when a planet moves over significant points in a chart, influencing market behavior. Gann was able to calculate how these planetary transits affected market cycles, and he applied this knowledge to forecast market turning points.
- Mercury Retrograde: Gann was particularly attentive to Mercury retrograde periods, as these can disrupt market communication and create confusion. Traders often see slowdowns or reversals during these phases. Gann applied Mercury’s influence to identify market retracements and reversals.
- Lunar Cycles: The Moon, with its 28-day cycle, affects emotions and market sentiment. Gann considered the lunar phases—new moons and full moons—as critical turning points in the market. The waxing and waning of the Moon corresponds to periods of growth and decline.
3. Astrological Timing in Market Cycles:
One of the most powerful tools in Gann’s approach was understanding the relationship between planetary positions and market movements. By using astrological charts, Gann identified perfect alignments of planets that coincided with price action on the market. For example, a planetary conjunction could signal the start of a new market cycle, while a planetary opposition might indicate a peak or bottom.
- Planetary Aspects: Key aspects between planets, such as conjunctions, squares, and oppositions, signal moments of market tension or harmony. These moments coincide with sharp price movements, either breakouts or reversals.
- The 360-Degree Cycle: Gann's deep study of planetary harmonics showed that the 360-degree cycle used in astrology is mirrored in the market. He mapped out specific points in the market based on the planetary cycles and their corresponding aspects to price levels.
Astrology in Practice: How Time and Celestial Events Shape Market Movements:
1. Astrological Alignment with Market Events:
- I look for planetary alignments that occur near key market highs and lows. These alignments give me an exact timing window for potential market changes. For example, Mars square Pluto often brings about periods of intense volatility, which could signal a sharp price movement in either direction.
2. Using Lunar Phases for Predictive Power:
- During new moons or full moons, I adjust my timing strategies. These phases, when aligned with market cycles, help me anticipate turning points. I make trade decisions based on these phases, particularly when a new moon or full moon coincides with significant planetary aspects.
3. Timing Market Entries Based on Planetary Cycles:
- I don’t focus solely on price levels but rather on timing. For example, during a Jupiter-Saturn aspect, I may take a longer-term position as this phase suggests growth after a period of contraction. Conversely, when planets like Saturn or Pluto are forming harsh angles, I may expect a correction or a trend reversal.
4. Calculating Time Cycles Based on Astrology:
- The math and geometry behind Gann’s teachings are intricately linked to the celestial bodies. Using astrological charts, I can pinpoint exact time frames when market changes are most likely to happen. The orbital periods of the planets are key to this predictive analysis.
Conclusion: Integrating Time and Astrology for Precision in Trading:
By understanding time cycles through an astrological lens, I’ve unlocked a deeper level of market prediction. The key takeaway is that the market doesn’t move randomly — it’s influenced by celestial cycles, and timing these cycles accurately can provide you with a predictive edge. Gann’s methods of combining advanced mathematics, sacred geometry, and astrology allow us to predict market highs, lows, and turning points with precision.
Once you master the art of reading astrological cycles and apply them to your trading, you can move from being a reactive trader to a predictive one, capturing market movements before they happen. This is where the true power of TIME comes into play, as it becomes the ultimate tool for successful trading.
USDJPY: RSI Above 50 plus 3:1 Gann fan being crossedAfter a downward movement, making the 139.574 low, we got strong bullish candles and weak bearish candles.
Today price crossed 3:1 fan line, crossing above 143.643, the last support since early August.
Today's candle close above an inverted hammer creating a bullish engulfing pattern.
RSI is following the trend and breaking above 50-level.
Gold could make 1948 as its peak. Buy in the dip!Hi, everyone!
Long time no see..
as i expected there's no severe recession ahead until 2026,
just a few banks and tech startup companies collapsed but not causing a crazy global economic fraud like in 2008...
this time is much more like 1999-2003 dotcom bubble, yes economic activity might be a little bit struggling, but not as insane as 1929 or 2008
I think gold could make its third top (2072) or double top (1948) before its going down to 1000s.
According to my Gann Angle and Gann Level - Fibonacci Combo, at least gold will reach 1948 in just a few days. Best advice i could give to you was BUY IN THE DIP!
Gold still pretty strong because it is still running at average of 2x1 angle or 200pips/daily bar.
Trend changes will only occur when it reaches horizontal SnR (fibo was the most accurate, so far..) and 1x1 angle or 100pips/daily bar (the yellow diagonal line)
I did a color coding on the gann angle to make a fast recognition, strong angle as light green to dark green -- mid level as yellow -- weak level as light red to dark red
Also on the fib/gann level combo, i color coded 61.8 and 38.2 with yellow as an important level that mostly cause a reversal
So, lets break it down..
17/21 March 2023 (Most Important) - I expect the first 1948 top will happen at this day before the news release
22 March 2023 (Most Important) - A 5 days down after the fed's hiking their dollar interest rates, i expect a bearish bias bottoming at 1893 or 1909 or 1917. But sometimes people getting greedy and this could inverted.
27 March 2023 (Important) - I expect Gold has reach 1948.2 level -- but since its weekly stochastic didn't crossover yet, i expect a continuation with a slight reaccumulation at around that area. But because fed rate hikes, i don't know what's gonna happen next
28 March 2023 - Some 2 days of bullish continuation
That's my current expectation for future weeks ahead, i don't give any responsibility in terms of capital loss or etc cuz i could be wrong
Trade safety, and Cheers!
H. Haidar
AUDUSD – LONGThe bullish momentum confirmed with ChoCH on D1. Liquidity was grabbed at the IDM level. Opportunity to buy on a false breakout of the Gann line. The target is the next Supply Zone.
AUDUSD – LONG
ENTRY PRICE - 0.66720
SL - 0.65900
TP - 0.69820
Always follow the 6 Golden Rules of Money Management:
1. Protect your gains and never enter into a position without setting a stop loss.
2. Always trade with a Risk-Reward Ratio of 1 to 1.5 or better.
3. Never over-leverage your account.
4. Accept your losses, move on to the next trade and trust the software.
5. Make realistic goals that can be achieved within reason.
6. Always trade with money you can afford to lose.
Please leave your comment and support me with like if you agree with my idea. If you have a different view, please also share with me your idea in the comments.
Have a nice day!
What Is a Gann Fan Indicator?Alongside other titans of the industry, like Dow, Wyckoff, and Elliott, Gann is considered one of the most influential figures in trading. After he developed the Gann indicators, traders picked up his teachings worldwide. In this FXOpen article, we’ll dive into two of the most popular Gann indicators, Gann angles and Gann fans, and look at how they work, investigate their uses, and explore their limitations.
Introduction to W.D. Gann
William Delbert Gann, known as W.D. Gann, was a legendary trader and market technician born in 1878. He began his career on Wall Street in the early 1900s and quickly began developing a technique for predicting market movements.
Gann's theory was rooted in his belief that the market followed specific geometric patterns and that time and price had a special relationship. Throughout his career, Gann developed various innovative tools for technical analysis, including Gann angles and Gann fans. These tools, known as Gann indicators, still have a valuable use in the markets today.
Gann Angles
Gann angles, as the name suggests, use a sloping line to help traders predict future price movements. These angles represent the rate of change between time and price. The primary 45-degree Gann angle is the 1x1 line, where the market moves one unit of price for every unit of time.
Similarly, angles like the 2x1 line, where the price moves two units for every single time unit, will result in a line flatter than 45 degrees. A 1x2 line will see the price moving one unit for every two units of time. Other angles are 1x8, 1x4, 1x3, and 1x2, while the angles less than 45 degrees are 2x1, 3x1, 4x1, and 8x1.
These Gann angles are primarily used to predict future support and resistance levels, plotted by the Gann fan indicator. When the price moves in the direction of the 1x1 angle, Gann believed that this indicates a strong trend with balanced supply and demand forces. Sustained moves above the 1x1 line show a bullish trend, while moves below are considered bearish.
The Gann Fan Indicator
Gann fans offer an easy way for traders to plot these angles. The fans consist of nine diagonal lines that use the price-time relationships described earlier, as seen in the diagram. This offers a broad perspective on where the price may end up and helps to forecast potential support and resistance levels.
To construct a Gann fan, traders start by identifying a significant swing high or low point in the market. From this point, they draw a 45-degree, or 1x1 line, to represent the most critical angle. The Gann fan is then plotted along the angle, creating nine lines. As prices approach or move away from these lines, we can begin to predict market reversals and trend continuations.
How to Use the Gann Fan
Let’s take a look at how to use Gann indicators, specifically the Gann fan. Traders generally develop a Gann fan strategy using three primary methods: identifying support/resistance levels, timing entry and exit points, and gauging a trend's strength.
Support/Resistance Levels
Gann angles within the Gann fan often behave similarly to trendlines, revealing areas where the price may stall or reverse direction. These angles help traders identify crucial support and resistance levels, which may inform their decisions on future price movements.
Looking at the example above, we can see that the 2x1 line offered significant resistance, even as the trend progressed bullishly. Meanwhile, the 3x1 line provided strong support, allowing us to anticipate that these two angles would hold whenever the price visited them.
Timing Entry and Exit Points
Consequently, Gann fans can help traders time their entry and exit points. As the price approaches a Gann angle, traders may anticipate that the market may reverse in this area. They could then look for confirmation with other technical analysis tools, like candlestick patterns or momentum indicators, before entering to catch the reversal or closing their existing position.
As with each of the Gann charts shown in this article, these angles aren’t guaranteed to hold. This might help traders identify opportunities where prices will likely continue trending. The choppy area marked by the box in the diagram above could have shown us that the price wasn’t ready to reverse up, given that it closed below the 3x1 line several times.
Gann theorised that once the price had broken through one angle, it would likely head to the next. As a result, we could have predicted that momentum was likely to continue to the 4x1 line and enter a position to catch the move. Alternatively, if traders had entered a trade on the reversal at the 2x1 line, denoted by the dashed line, they could take partial profits at both the 3x1 and 4x1 lines.
Gauging a Trend’s Strength
As mentioned earlier, the 45-degree 1x1 line can also show us the strength of a trend. In the chart above, we can see that significant bearishness entered the market on the left-hand side. This was confirmed by the fact that the price was sitting beneath the 1x1 line, indicating that the strong bearishness was likely to continue.
Using this knowledge, traders could have predicted that the sharp move downward would carry on. As the price began to cross over the 1x1 line, the trend’s strength weakened. Traders could then start to anticipate that the price might begin to range or recover slightly, as it did in the chart.
In this sense, traders don’t even necessarily need to use the Gann fan. By drawing a 45-degree angle from a key swing point, they can use the line as a Gann trend indicator and expect that price will follow the trend's direction as long as it remains above (if bullish) or below (if bearish) the 1x1 line.
Limitations of Gann Indicators
While Gann angles and fans may provide valuable insights into the market’s behaviour, there are some limitations that traders need to be aware of. The biggest issue is subjectivity. Different traders identify different swing points; some may prefer the last swing point, while others use the most extreme. This might lead to differing results and interpretations.
There’s also the issue of subjective scaling. While a 45-degree angle seems simple enough to apply, the angle depends on the zoom and price-to-bar ratio of a trader’s chart. As a trader zooms in and out, the line will stay at the same angle, but its position on the chart will change.
This can be mitigated by locking the price-to-bar ratio of the chart, but this a) makes zooming in and out of price action cumbersome and b) still doesn’t offer a “true” 45-degree angle that can be universally agreed upon.
To see this for yourself, try using the Trend Angle tool under Trend Line Tools in TickTrader. Then, apply it to a swing point, and zoom in and out. You’ll notice that its position can vary wildly depending on your zoom level.
Besides locking the price-to-bar ratio, traders can try to correlate the 1x1 line with an area in which the price reversed, then plot the Gann fan over it. This may help to bring some uniformity to the process.
Your Next Step
In summary, Gann indicators, particularly Gann angles and Gann fans, may help us predict future price movements with a high degree of accuracy. However, their subjective nature can make them tricky to apply consistently, and they are better suited to more experienced traders.
Once you’ve mastered the Gann indicators, you can open an FXOpen account. We offer a wide range of markets, competitive spreads, and an ECN-based order routing system, so you can trade using Gann indicators and other advanced trading techniques. Good luck!
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Where is BTC going Bitcoin interacted negatively with the interval and continues in a descending channel to the following levels:
-25,000$
-24,700$
And with the convergence of the downward internal trend, shown in white, with a substantial demand area, it is likely to rise to reach once again the ceiling of the channel and be able to penetrate it towards the 28k level by the end of June.
In the long term, Bitcoin still maintains high positivity, which makes the idea of it reaching the 40k level by Aguast not far-fetched.
GOlD move higherjust like my previous announces gold went to 2007 area and moved up .Also in NFP day gold made a serious down trend to 2000.34 which is a strong psychological barrier so we could expect move bullish continuation according to the Gann speed resistance theory and according to the technical perspectives .we are not looking for selling positions .we are only looking for buy opportunities .GOOD LUCK(just an idea:not a financial advice)
MCK DAILY - Breakout on EarningsToday a gap up on positive earnings and revenue, Today an ascending triple top breakout on the point & figure.
This is a health care stock (timely sector) with superb financials.
This is not financial advice, but if I were to load into this stock, I would:
a) look for a pullback to 381.43 (potential VPOC support) for potential entry
b) Look for a further pullback to 376.19 (Gap fill) for potential entry
c) In the event this is a runaway gap, I would look for a breakout above 401.78 (52 week high), where there should be free sailing ahead.
d) Point & figure target is currently 459 (long position only).
Update BTC April 2023Please watch my previous video on Mars influence to understand why a long term correction is likely. We could see a final push up to 31500 area before price turns bearish over the next several months.
In this video multiple Gann and confluences were used such as 90 degree subtraction angles, time-squared pivots and 50% levels.