Looking @ W.D. Gann – Part Five

Gann Swing Trading

Gann was probably one of the first ever Chartists who used charts to trade with and from – I’ve not conducted a thorough research of stock market history so I can’t be 100% sure either way, anyway the point is in the early 1900’s Gann used charts to trade from and with – fact!

(I can remember trying to research charting and technical analysis methods in the early 1990’s and in the UK I could find very very little! This was prior to the internet and finding the information was difficult – maybe I was looking in the wrong place?  Maybe but the experience put me off looking to hard for years)

The basics are that the Swing Chart shows you the direction of the trend and until a swing high/low is taken out then the trend is intact.  At first Gann used a 3 day swing chart to make up his swing charts, just before he died Gann changed his thinking to using a 2 day swing chart

For an authoritative view on this subject I’d refer you to:  http://www.marcrivalland.com/ who uses and trades Gann Swing Charts, Marc has also written a fantastic book covering the subject too of which I recommend.

I have also listened to Marc in a seminar and he makes around 15-25% per annum from trading the FTSE100 index using this method

I’m being really lazy here and not detailing a chart for you to visualise – google “gann swing trading” and take a look for yourself

Basically Gann Swing charts define the Higher Highs and Higher Lows of an uptrend in visual form and vice-versa for a downtrend.

Please note that where an Elliott Wave ABC correction occurs the Swing C of the ABC WILL trigger a FALSE buy or sell on the Gann Swing chart – I keep telling you nothings perfect and this is where Gann swing charts fall down when there is a clear ABC correction based on Elliott Wave Theory!.

Enjoy

The Hovis Trader

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