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GANNacci Code ( review

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lameo View Post
The key to balancing P&T is the use of scale. One time unit for every one price unit - the use is relative and not clearly explained by Gann. Let's say if S&P500 is trading - at a given moment - at 1408.75 that means that if this price is 1409 TIME UNITS (hours, days, weeks, months) away from a previous MAJOR Hi or Lo, then a change in trend is due. Gann would say the price 1409 is touching a ZERO ANGLE from top or bottom X, Y, Z ...whatever. The larger the time unit, the larger the change.

@lameo: Thank you for upright answer, much appreciated. Now let me ask a question. Why do you think that if you have a high at 1408.75 this should be related to any 1409 time units whatsoever. Trading is not a religion and time units are not related to price.

Or let me put it otherwise. If you trade YM or FDAX, they will likely have their highs at the same time as ES. But for ES you will have to search for a major high and low 1,420 time units back, for YM 13,200 time units and for FDAX 7,000 time units. See chart attached. There are more stocks that move in parallel with ES and many of them have their highs and lows at the same time. But they all have different prices. Also see chart below.

I conclude by applying simple logic that the absolute prices of stocks cannot be related to time units. I further conclude that anything like squaring price and time is pure nonsense.

If you look at the writings by W.D. Gann, he has produced a lot of rubbish. He also was a great trader and some of his writings are definitely worth reading. That makes it difficult to sort the sheep from the goats.

Here is an example from one of his works (The W.D. Gann Master Commodities Course - Chapter 8): " - The planet Jupiter is at 21 degrees gemini, which is 81 degrees in longitude from "0" the square of 9. Subtract 135 degrees from Jupiter gives 306 or 6 degrees Aquarius. This is why Soy Beans have met resistance so many times between 306 and 311 1/4...."

It can't be that difficult to understand that this is mere hocus-pocus. Not easy to write something which is more stupid. Angles, fans, squares of 9 will never work.

On the other side, I have coded an indicator - the GannHiLoActivator - which is based on the works of W.D. Gann. It is sort of a precursor to the SuperTrend, and I do not think that it is stupid at all. W.D. Gann's teachings are a peculiar blend of practical approaches that work and numerological and astrological nonsense. Be careful not to take all of it seriously.

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Last edited by Fat Tails; September 2nd, 2012 at 03:09 PM.
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