Gann Theory: Behavior Of Three Factors And Strategy Used For It

William D Gann, in the 1900s, devised a concept known as the Gann theory. His belief in the stock market's frequent price change relating to natural geometric shapes focused on predicting future price movements in relation to time.

Most traders take their position by looking at the price and relying on Gann angles to get on the right side of the significant trades and trends.

The whole trading Gann analysis is based on angles. Let us know more about Gann trading and what it is all about.

Gann Theory: Behavior Of Three Things

Price Study 

The Gann angle helps us observe the angles suggesting the price patterns of the stock. This prediction of price movement in the stock tends to rely on support, resistance point, and pivot levels.

Time Study

The model of time study suggests the time when stock price shall reverse. Time study also provides us with historical data that helps derive the future fate of the market.

Pattern Study

The investor's activity and movement of a particular stock are kept in assurance with the pattern study. 

Applying Gann Trading Strategy

• Stock market moves in a time cycle.
• Price, time, and pattern (as discussed above) are the three factors affecting a market.
• The market is geometric in movement and design.

These assumptions, as mentioned above, form the basis of the Gann trading tutorial and strategy.

A trader should remember that the market moves in angles, which remain the same. An asset moves in angles, a phenomenon called the Rule Of All Angles. This rule states that once an angle is achieved, it moves to the next angle. Therefore, Gann angles are commonly used to find support and resistance lines.

Gann's trading strategy is so efficient that it can also be used to determine the time zones for certain price levels. This also includes predicting when certain price levels will be reached when there could be a reversal.

Conclusion

This theory can help you analyze the market's efficiency in a better way to predict the future stock price movement. Remember that time and experience are necessary to work on Gann's theory.