I've gotten some questions regarding how the Gann angles help traders anticipate potential turns in the market. Using the same exact scale of the Monthly S&P 500 Index chart, we can see last months low come extremely close (approximately 8 points) to the 2 X 1 Gann Angle.
This support level gave a signal to potentially expect some volatile action. For the better part of July and the beginning of August, the volatility has at the forefront of the Senior Indexes.
Trade Smart
~Duane Gott
I've found the key to Gann angles is that price moves in doubles and halves of the slope of significant ranges. It is convenient to draw the 1:1 from the low to the high of a upward range. But it is not required. Price will follow the current slope, move toward half that slope, or move toward double that slope. Gann angles are simple until people over think them.
Posted by: Andy Askey | August 09, 2008 at 08:18 AM
I couldn't agree more.
Gann analysis can be made very complex, but when it is approached simply and within a rules based structure, it can add a whole new level of accuracy to ones trading.
Posted by: Duane Gott | August 12, 2008 at 03:46 PM
If you look at the daily on the DOW & the SPX we have had a FSB stochastic sell signal(also a type 1 sell). From classical t/a we have had a rising wedge which is a bearish pattern & price has broken to the downside of the lower trend line. From a Gann angle perspective (using a gann box) price has found it hard to break the 1,1 up line on the DOW & SPX. Price (or the mouse) found it hard to get past the 2nd room. However the RUT seems to show the complete opposite price action breaking past the 1,1 up line & getting to the fourth quadrant of a Gann box & making a new high. Any comments as 2 indexes (DOW,SPX) are showing weakness whereas the RUT is showing strength ?
Posted by: anthony | August 25, 2008 at 04:15 AM