This post was most recently updated on May 23rd, 2023
WD Gann was a famous trader who lived in the early 20th century. Many traders still consider him one of the most influential traders in history. They continue to use his methods today. Gann’s trading was based on a wide range of techniques. These techniques included market analysis, charting, and predictive methods.
One of Gann’s most significant contributions to trading was his use of the geometric relationships between price and time. He was a master of technical analysis and used various tools to identify key support and resistance levels, trend lines, and other market patterns. Gann’s trading strategies were based on analyzing these patterns and using them to predict future price movements. Much like harmonic pattern traders,
Gann believed markets moved predictable with structures and patterns.
Gann employed the analysis of market movements by focusing on their cyclical nature. His approach involved identifying price cycles to pinpoint crucial market turning points. Gann would then use this information to make informed trading decisions.
WD Gann had an interest in astrology and other esoteric practices in addition to these methods. He believed that astrology could predict market movements, and he made trading decisions based on this information. Gann’s market analysis involved utilizing astrological principles, such as planetary positions, cycles, and celestial events, for market predictions.
Astrology is one of several alternative trading strategies that traders use to gain an edge in the markets. While there is no scientific evidence to support astrological trading, many traders believe it can be effective when used in conjunction with other technical and fundamental analysis techniques. However, most traders do not widely use astrology and consider it unreliable
WD Gann’s approach to trading involved a concept he called “squaring price and time,” which he believed could be used to predict future market trends. He believed that markets are cyclical and that price and time are intrinsically linked. Gann used mathematical calculations and geometric shapes to determine the key levels of support and resistance, and he believed that these levels could be used to make profitable trades.
Squaring is the process of finding the connection between time and price. Gann used the square in his various market analyses, believing that it was more than just a geometric shape. He believed that the square represented the balance between time and price, and that this balance was constantly in flux.
Gann applied these concepts to financial markets, specifically analyzing price movements on a chart with time considered as the x-axis and price as the y-axis. He identified key support and resistance levels by finding the price and time levels on the chart that intersected at right angles. Gann believed that these intersections signaled key market turning points.
To square a price and time, Gann used a series of complex mathematical calculations based on the specific market he was trading. He looked at the highs and lows of a market and used this information to calculate important time and price intervals. He then plotted these intervals on a chart as squares, using them to identify key support and resistance levels.
Gann believed that these intervals provided key insights into future market trends, and he used these insights to make profitable trades. However, it’s worth noting that the mainstream financial community did not widely accept Gann’s methods and considered them controversial due to a lack of empirical evidence supporting their effectiveness.
Using WD Gann Angles Today
In my own trading, I use WD Ganns squaring of time as a reference. I will not necessary make a trade based on say if the current price touches or breaches a critical angle. I will however pay closer attention and look for direction of price movement in a certain direction. Just knowing whether to be Long or Short makes things a little easier.
When analyzing a price chart, I typically begin by drawing angles at key support and resistance levels.
You can see that a divergence is beginning to form. This is a great heads up to a possible change or move that is about to happen. The Gann lines are great because they measure time and not just price. We get a clue into the future of possible turn dates. I want to emphasize ‘possible’ because nothing is absolutely certain in analysis.
Coupled with math, WD Gann angles and cycles. Gann applied all these methods to arrive at his forecasts. Many traders follow Lunar cycles. Gann was no different and took it even beyond the Lunar cycles. He watched all the movements of the planets and their relationship to each other during a particular time.
Trading using Lunar astrology involves analyzing the Moon’s cycle and position to make market predictions. Traders use a Lunar chart as a tool to track the Moon’s cycles and its relationship with the trading markets. Here are some steps you can follow to trade the financial markets using a Lunar chart:
- Obtain a Lunar chart: You can access Lunar charts online or through astrology software. Lunar charts show the phases of the Moon, its current position and its relationship to the other planets in the solar system.
- Identify key points of the Moon cycle: Identify the new and full Moon phases. These points are considered significant periods that can influence the market in different ways. The new Moon phase is often associated with a time of low activity and the full Moon with a time of high emotional energy and more significant market activity.
- Observe correlations between the Moon and the market: Analyze the movement of the markets and how they correspond to Lunar phases. For example, you may notice that during a Full Moon, the markets experience high volatility, or prices may rise before a new Moon phase.
- Use technical analysis: Although Lunar astrology can provide insights, it is not a complete trading strategy. Use other technical analysis tools. ie. Chart patterns, trends, and indicators, to confirm Lunar chart signals and make informed trades.
It is worth noting that the use of astrology in trading is considered controversial. There is no definitive proof that it is an effective trading approach. Therefore, traders using Lunar charts must combine them with other analytical tools and strategies to increase their chances of success.
WD Gann s use of squaring price and time was a unique approach to market analysis. While no longer as popular as it once was, his techniques are still studied and practiced by some traders today.
WD Gann and his methodology can be overwhelming and complex. I would recommend learning it very slow. With an open mind to the stars I hope you appreciate his genius the way I have in my trading journey!