William Delbert Gann became very popular in the trading world due to the accuracy of his methods for predicting price trends in the market. He made use of geometric figures that allowed him to determine the patterns that prices are taking. He had also considered the time element when plotting where the possible price movement will be. Today’s traders still make use of the trading concepts that were developed by Gann throughout his trading career.
People who want to succeed in their trading business just like Gann will have to practice not only hard work but also self-discipline. Traders need to be able to curb their tendency to over trade or be greedy to want more profit because in the end they are bound to lose more. They need to understand the psychology of traders so that they can avoid the usual mistakes that traders make, such as incorrect trading moves that were based on their sentiments and not their accurate market projections through reliable market analysis tools.
WD Gann mentioned the use of the concept of time by degrees in his analysis of the market. He believed that by counting time by degrees in a 360 degree circle, the time element is kept uniform, which will make projections more accurate instead of using seasonal changes or days of the year. It is vital that traders can see the cycles that the movements indicate. Traders can also use the swing charts that Gann developed if they are monitoring trends over a three day period. This is particularly useful for analyzing short-term market price movement.
Gann also made use of squaring the price on the time element and then squaring the time element on the price. This is done to determine the highs and lows and traders can do this by calculating and marking their trading charts. He also indicated the retracement levels through the geometric figures on his chart. Although he applied the golden ratio principle, he paid more attention to the 50% level where most of the retracement is likely to be expected.
Traders today still make use of the geometric figures that represent WD Gann’s concepts when it comes to analyzing how the market moves. The geometric proportions that he pretty much based on the circle, square, and triangle are still being used by those who trade in commodities and also in the stock market.
