@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.
Please register on futures.io to view futures trading content such as post attachment(s), image(s), and screenshot(s).
Last edited by Fat Tails; September 2nd, 2012 at 03:09 PM.
The following 2 users say Thank You to Fat Tails for this post:
thanks for your comment. You are asking reasonable questions. I'll try to answer to a certain extend but with no promise that this is all - although Gann sounds simple, this is only on the surface. There is much more than the eye meets... There is no such thing as Gann fan - this is someone's wrong interpretation of Gann, but is quite popular as a trading instrument in some trading softwares for those who do not know Gann. Gann used planetary longitude and converted it into price and vice versa - he converted price into time, but using different scales interrelating price and time. He used the solar year as a circle of 360 deg, very close to our 365 days. He measured everything according to the circle of 360 deg. He used not only the solar year cycle but also the Jupiter, Mars, Saturn, etc - but in every case he related one deg planetary movement to a corresponding price change. Things get really complicated the more correlations one finds. Actually he used prices as if they were planets. He talked about "squaring the range, squaring lows and squaring highs. I think he aspected price and time using the major astrological aspects - that is why he talked so much about squares and triangles and the corresponding numbers 45, 90, 180, 120, 270 etc, which are actually DEGREES OF THE CIRCLE. In the case of soybeans letter you quote", 21 Gemini means 81, because Gemini begins at 60 deg after the spring equinox, which is 0 or 360 deg. 360+81=441, square of 21, by the way.
441 - 135 deg (major planetary aspect, others are 90, 180 and 270) gives you THE PRICE 306, which he explained as ONE OF THE IMPORTANT RESISTANCE LEVELS, bacause the beans traded there at the time he wrote his letter. He stated that Prices are governed by TIME, meaning PLANETARY LONGITUDE, and Gann angles are actually planetary longitude balancing Price and Time. So if I had to use the word rubbish I would apply it to "Gann fans".
I'm not sure I can give good explanation of the example with your charts following almost identical cycles but trading at different price levels. This would take time for experimenting... not now, please. Yet, Gann would say a price of 7 113 - for example - is 19 times the circle of 360 + 273 deg over, or 3 deg Capricorn, or the time (solar) around Christmas:. Gann used his astro-knowledge in MULTIVARIANT manners that are not always clear to his readers including myself. For example in his coffee letter he uses several ways of correlating P&T- he uses 12 points of price change to one deg of Jupiter move, since Jupiter cycle is 12 years, in the case he uses Saturn degrees - converted into earth days - he relates 1 deg of Saturn time to 30 points price change, because the Saturn cycle is 30 years and also he uses 1 point to 1 solar deg, which is one day for us - so here he gives 3 different variants of balancing P& T (Jupiter, Saturn and Earth time). To add insult to injury Gann would have probably found a dozen more other correlations and aspecs with planets and important tops and bottoms. In the case of the example with the Price of 7 113 ( I can not see clearly the prices on your charts) I would look for squaring of time periods harmonizing with the number 273.
PS The attachments represent original Gann charts he draw himself.
More - the divisions of 8ths of P&T are 45 deg divisions of different cycles, related according price and time to numbers 360, 720, 1080, 1440 ...12 960 etc. Same is true about the 1/3 and 2/3 divisions fr P&T representing 120 and 240 aspects, or the trine. Gann considered the all time high and all time low equivalent to major cycle expiration when/where P&T were equal, or balanced, or squared and then measured the repetition of this cycles (and their divisions as resistance levels) in both time and price units projected ahead in the future as conjunctions(360), oppositions (180 deg), squares (90, 270), semisquares (45, 135) etc etc.
Last edited by lameo; September 2nd, 2012 at 03:02 PM.
The following 4 users say Thank You to lameo for this post:
May I cite a passage from the New Market Wizards, interview by Jack Schwager with William Eckhardt (Collins Paperback, page 111)
"I have always been amazed by how many people are either oblivious to the scale-dependent nature of chart angles or unconcerned about its ramifications. My realization of the inherent arbitrariness of slope-of-line methods is precisely why I've never been willing to spend even five minutes on Gann angles or the works by the proponents of this methodology."
This statement - which was made by Jack Schwager in response to an explanation by William Eckhardt - says it all. I have already spent more than 5 minutes with the subject, and I will now leave this thread for good.
@lameo: We certainly agree that we have a different opinion on Gann's methods. I don't mind.
Right now, our man Nick of gannaccicode has a special going on and deeply discount his stuff. To his credit, he seems to have more transparency than the tons of US snakeoil traders parading themselves as selfstyled trading mentors. While I havent seen his trading statement, somethign that is akin to asking a guy to see his genitals, he openly says what he trades and the contracts he risk. Unlike many, he constantly runs his works across forex and futures pairs. his mantra is that he trades at the risk to reward of 7:1.
i really would want to hear of those who have been longer than 5 days in the room.
Isnt there a way of getting similar info from other software without forking out 1500
Nick extensively uses a 50% level and believes religiously that once a magic bar breaks the 50% fib level, it will reach the targets, that r 1.218% levels. is there a way of spotting what kind of magic bar he watches. Who else out there uses Gann crystall ball with high degree of precision timing
for the Gann enthusiast, Gann indicators and stuff r also found in dynamic trader and mtpredictor. but the extensive ones are in dynamic trader. if u can get version 3 of dynamic trader, u can pretty much run Gann fans and works there