The Gann Square of 9 is a trading method used to forecast future market prices and movements. Since the early twentieth century, this method has been adopted. It was created by William D. Gann, a prominent stock speculator.
Who is William D. Gann?
William D. Gann was a successful stock investor who gained more than $2 million on the New York Stock Exchange by employing his Gann Square of Nine trading approach. He never taught anyone his approach, never published a book about it, and never had followers who could teach others how to utilize it. Currently, just a few elements of it are used by traders, and no one completely understands it.
Despite a dearth of instructional information on the Gann Square of Nine, traders have effectively used it to execute lucrative trades and forecast market behavior. Gann allegedly devised the approach while traveling abroad and applied it when he returned to the United States. His investing technique is the product of combining his understanding of biology, mathematics, astrology, physics, and other fields of study.
According to its supporters, Gann theory works because it incorporates a natural harmonic rhythm into anticipating securities prices. Because all of them are bound by natural law, trustworthy stock forecasts may likewise be generated using the appropriate natural law principles.
What is the Gann Square?
The Gann square is made up of nine rows and nine columns. The market price from which you wish to extrapolate is put in the center of the square; this cell is known as the basis. With each subsequent square, the numerals rise by one from the bottom. By spiraling away from the base, the squares are allocated numerical values. The Gann square contains 81 numbers in total.
Gann Square Crosses: Cardinal Cross and Ordinal Cross
The Gann square may be used to forecast the price at which future resistance and support levels will exist. These prices are in the cells on the chart that are at 45 degree angles. Gann estimated that numbers with a 45-degree angle were the most powerful and had the most effect on market behavior.
According to Gann, the values having the most weight are positioned along the ordinal and cardinal cross.
Cardinal Cross
The cardinal cross angles are 90, 180, 270, and 360 degrees. The angles are more significant and of higher importance than the angles on the ordinal cross.
Ordinal Cross
The ordinal cross numbers are 45, 135, 225, and 315 degree angles. These angles, while important, are less weighty and influential than the cardinal angles.
Predicting Resistance and Support Levels Using Gann’s Square of Nine Calculator
The most common application of a Gann Square of Nine chart is to forecast a security’s resistance and support levels. You may accomplish this by following the instructions below using a Gann chart.
- Examine the candlesticks on the market chart and choose the lowest applicable market price on the chart.
- Place the lowest market price in the center of the Gann square and use it to calculate the Gann square of 9.
- Next, select and highlight the security’s current price on the chart.
- To determine the resistance level, travel clockwise away from the present price (with prices increasing). The price values you want will be found on the cardinal and ordinal crossings (ignore the price values closest to the current market price). The values on the cardinal and ordinal crossings are the resistance levels predicted by the Gann square of 9 calculator.
- To determine the support levels, travel counter-clockwise away from the present market price. The values on the cardinal and ordinal crossings represent the predicted Gann square of 9 support levels.
If you don’t want to work out or learn how to utilize a Gann chart, you may quickly compute the next resistance level for your market price.
To determine the next degree of resistance, use a calculator and follow the procedures below.
- Take the square root of the market’s lowest applicable price. Assume the current market price is US$28.
- If the square root of the integer has a tenths position digit that is greater than 1, add it to the number in the ones position. The square root of 28 in our case is 5.29. So, multiply the number 2 by the number 5 to obtain 7.29.
- Square the new figure. In this example, the answer is (7.29)2, which equals 53,14. You get 53 if you round the number down. The next level of resistance will be at $53.
- Because a tenths number bigger than one indicates that the next resistance level value is in a different quadrant of the graph, it must be added to the one position. Adding the number 2 to the ones places shifts the resistance level calculation to the right one quadrant.
Learning to Use the Gann Square of Nine Calculator
Because there are no experts, university courses, books, or other instructional resources on the Gann Square of Nine, practitioners must rely on the work of others, collaborate, or figure it out for themselves utilizing Gann’s work.
Using the Gann principle to trade is not simple or quick. It requires focused work, a lot of time, and a lot of experimenting. Furthermore, the Gann square of nine calculator does not work on a daily basis. It was never meant to be used for intraday trading. It was designed to be used for long-term trade (e.g., weeks, months, years). Even so, some intraday traders utilize it to forecast resistance and support levels during the trading day.
Furthermore, Gann’s approaches are ineffective when the market opens. Before conducting their Gann square job, the traders must wait at least an hour.
Key Takeaways
The Gann Square of 9 trading method has shown to be a dependable approach to trade in today’s market. Traders who have studied and comprehended it claim that it is 90% accurate.
Gann’s idea is likely to be difficult to learn and use for new or inexperienced traders. Traders should also avoid using trading techniques that they do not understand or have not tested. So, if you grasp Gann theory, you may make millions of dollars in the stock market like Gann.
