Gann Theory Chat

W

WDGann

With this Gann Theory Chat, I'd like to make my job easier by doing some pre-chat feedback.

Reason is to make the chat more focused on deeper aspects of Gann. So until Friday, I'd like to post some FAQ-like material on ET. Gann Analysis has a relatively definite step which people follow. Going through all levels of Gann enthusiasts would take forever and the quality of the chat might be going in circles.

To keep the chat in a reasonable level, first, I'd like to provide a ELS code with the "minimal" Gann aspect coded in it. I hope this code can weed out starting Gann traders and have all the experienced Gann traders to come in and talk beyond the level of the code. (That doesn't mean the new Gann traders are not invited... I just HOPE to do some reasonable chat in my own terms)

Personally, I have other aspects of Gann which I use. There are filters of basis in which I understand about Gann. My philosophy about the market is that everything "rational" about the market can be quantified and/or coded. I've been correct about this because the code is there.... Also, it's not a discretionary or mystical technique but something with definite rules, if you really have the mind to accept it.

It's coded in TS2000i and I'm not sure it'll work in TS6 or 7 or 8(if it's out). Also, the code is limited to work until Friday, for my own terms and password protected.

Please E-mail me to for the code:

tsaimoto@hotmail.com

The password is:

"Gann is Mechanical"

Optional777 Bless (LOL)

WDGann
 
The recommended books and courses are:

Books by WDGann:

How to Make Profits in Commodities

Truth of the Stock Tape and Wall Street Stock Selector

45 Years in Wall Street

New Stock Trend Detector

Tunnel Thru the Air or Looking Back from 1940

Magic Word

W.D. Gann Commodity Trading Course

W.D. Gann Stock Market Course

I personally think this the only material needed. All the other guru-ed books are practically worthless in my sense. Also, Tunnel Thru the Air is over-rated. I've only read it once and that was enough for me. I actually find the Magic Word, to be a strong key to understanding Gann and how he interprets it.

Can be bought at:

www.wdgann.com

Others that I found interesting:

www.sacredscience.com

Well, they offer Jerome Baumring's material. He was said to be one of the few people who understood Gann Analysis. I think this is true. His courses are somewhat subjective like Gann but I think it is the right approach.

The site offers 2 types of courses, one includes meta-physical background material and the other offers notes from Baumring's seminars. I think the background material to be more important. The notes are great but they tend to bias the reader with how to interpret it.

I am also proud to say that I was one of the first customer at the site.

Now that I've mentioned Baumring, there are students of his that are now gurus. Just off my head there's Robert Miner, Brad Cowan, Gregory Ruff, the programmer for Ganntrader (I forgot his name), people at sacredscience were students of Baumring. So I have to say, 90% of most Gann material or Gann-related material are more Baumring-Gann Analysis, rather than Gann Analysis.

I'm not saying it's wrong, it's better to know than not know.
 
Most of my studies are from Gann's original material. Like everyone I got stuck with the material so I bought some books by others that were written about Gann like Gann made Easy (Honestly, it's worthless piece of %$#@.)

Back around 7 years ago, the internet wasn't so large at the time. There was no website about Gann, so I called Nikki Jones at Lambert-Gann and bought the books and courses. I didn't have a computer so I also bought chart paper from them and started charting Corn and Beans.

Soon, the internet started picking up and I started to see Internet site about Gann. At one of the sites, which is now gone, I found out that Gann had left a reading list for serious students. The bulletin board contained about 15 books in it so I went ahead and started looking for them.

Well, I was in LA at the time and there was a large meta-physical bookstore called Bodhi Tree. I found 9 of the books and started reading other books that were related to the subject. Some of the subject I read are Astrology, Music (Acoustics), Physics, Kabbalah, I-Ching, Meta-physics and Hermetics. I think by then I read about 80-90 books, thanks to my speedreading.

By then, I had a good idea about Law of Vibration. Gann Analysis and other topics started to connect. Well, I think it was around mid-1999, sacredscience.com opened up, I bought most of the courses there. First, they had a 1/2 price sale so I bought as much as I can in a limited time, also. I understood most of the stuff but I found a few more topics that I found interesting like Chaos Theory, Sacred Geometry and others.

After that, I haven't bought any Gann books. I've gone through some of the guru's website and most of them are BS. There are some that a legitimate but I really don't need them. Most of them are too biased with one idea.

So what about me now?

There's a lot I don't know about Gann, but it's not a mystic for me. It's more like creating a system for me. You come up with a new concept and apply them to your analysis. Once you apply it, you find new aspects of the older system making it new and improved. Which leads to the next which lead to the next and so forth....
 
This is really hard topic to mention. I'm not a expert in looking into the price and time retracements of the Fib Ratio, though I do find some when I study the charts.

Sticking with Gann, the concept of Fib Ratios are not mentioned but greatly included.

First, I believe that the market moves under natural law. Fib Ratios are part of it and because of " my biased" fact that it does, when you draw a line or calculate any indicator based on charts, the ratio pops out in different ways.

Second, there are proportional and ratio-nal relations within Gann Analysis. There is the Hexagon chart that great emphasizes on market condition which tends to give out Fibonacci ratios in proportions. Baumring-Gann Analysis(es)extracts the Hexagon Chart and Sacred Geometry into Square Root of 2, 3, and 5.

(Root 5 - 1) / 2 = 0.618

It's numbers game but there seems to be some resemblance. That's all I will say about Fib Ratio and Gann relationship.
 
Few things...

I suck at scalping the market. I've figured out through experience that I analyze the market as a picture rather than series of numbers. Trading the book or depth is too unfitting.

I usually have 2 charts for both NQ and COMPX, making it total of 4 charts. One chart has few of the Gann material that I use in intraday trading. The other is a blank chart.

Honestly, I really don't use Gann Charts as much when I trade intraday. I take time doing Gann Analysis and my brain freezes into the "Analysis Mode" rather than "Trading Mode". I try my best to be passive with Gann.

One fact about my Gann trading is that I have a better performance when I trade larger timeframes. On a Weekly+ trading, I had 93% profitability trading long term commodity futures and stocks. I also used CANSLIM setup and filtered the list of stocks with Gann... so 1/2 of my performance comes from CANSLIM :). For commodity futures, I used Turtle-based system and some supply-demand analysis so I owe some of the performance to them too. Also, the Internet Bubble helped out too (sorry, helped out a lot).

I've had a Daily Swing (holding it 2-5 days) trading performance of 74% profitability. I would have done better if I had used intraday charts to fill the orders but it was traded only at the Open. I was still a EOD trader at the time but it gave me enough lessons. I started doing swings when I started writing my own systems. I've tried a few kinds of linear systems like moving average or stochastics, and filtering them out with Gann. So again, I owe 1/2 of my performance to the system I made.

Well, with the intraday... it's weird. At the prop. firm, I started building some intuition with charts. Because of my slow brain, I found it better to rely on my discretion rather than Gann. The intuition comes from my blank 5 min. charts I have placed. Gann is used when I find the market to be in mixed situations. I used to prepare the day with significant figures but I found that those things tend to bias me too much that I try to do my Gann Analysis at the moment.

I'm still a building intraday Ganntrader. My % profitability for intraday is 73%. I'm a intraday swing/trend-follower who tries to cut the losses small as possible. I do a lot of pyramid and partial profit-taking. The performance is based on each individual exits.

But this performance doesn't resemble Gann so much so what can I say...
 
With Gann, there is a clear line between Analysis and Trading.

When you approach Gann Theory, not knowing the 2 difference usually gets people confused. Some get confused with what he talked about his Mechanical Trading Methods with what he says about Cycles. This creates and actually delayed a lot of what I studied.

First, all of his books are concentrated on the "Trading" part. On his trading examples in his books, he mentions a few points about the analysis like, "Trend has changed and with a Double Bottom". When you see the word "Trend", you should expect him to have another analytical bias letting him trade.

Another thing is when he mentions, "Rules" in any part of the book, it's about the "Trading" part.

Speculation: a profitable profession
Mechanical method and trend indicator for trading in wheat, corn, rye or oats
Rules for trading in soybeans, corn, wheat, oats, and rye

in the courses are also "Trading" sections.

I'm not saying the books and the 3 sections don't include and have viable keys to understand his analysis. It's just more efficient to approach it that way.

Analysis part is the harder one. One section in his book that is the most confusing is the Master Egg Course. He goes between trading and analysis thoughts, back and forth that it's very confusing.

I would approach, Angles, Cycles then Master Charts. Well, it's actually, Angles, Cycles, Angles, Cycles, Master Chart, Cycles, Angles, Cycles, Master Chart, and so forth. You just keep on going back and forth with all these concepts.

As for Master Charts: Gann Wheel (Square of Odds), Square of Even, 360 Master Chart, Hexagon Chart, Square of 12, Square of 9 then Squaring the Circle Charts would be an order I would take to look into. Though, again, you keep on going back and forth every time you grasp a concept.

Once you get to point of understanding and seeing cycles within angles, it should be a natural progression to get into other stuff. Technically, it's the first hurdle to pass.
 
It's part of cycles. Planets move in cycles, market has cycles, people has cycles... there's no difference...

Seriously, angles are largely a representation of market cycles. Drawing Astrological line are just like drawing a 1x1 line on your chart. They should be taken in the same manner. Separation of both creates mysticism and confusion.

After looking deeply into Astrology, I found myself feeling stupid about separating it from the start.
 
I'm sure I'll be getting this question... so my honest answer is:

No, it's all BS. But I've been trading well using it.

It's like asking if Moving Average or Stochastic work. It doesn't seem to fit me well but there are traders I know who can make it work.

For a "TRADER", anything that doesn't work for the individual is BS, for them...
 
Yes, I have read about how Gann died practically broke. Honestly, I don't know what the truth is. I've never met Gann or his sons. One thing I can say is, Gann's analysis works for me.

My conclusion is that Gann was a beach bum. I'm not W.D. Gann, himself and never will be. It's just that his theory fits me profitably.

Uhhh... in another words, I don't care what kind of a guy W. D. Gann was. Just because you use CANSLIM, it doesn't mean you're going to trade like Bill O'Neil.... some do better, some do worse...
 
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