Summary of "Ganns Main Methodology"

Summary of “Ganns Main Methodology”

This video provides an in-depth look into W.D. Gann’s forecasting methods, emphasizing the critical role of time cycles combined with geometric price analysis. The presenter, Ba, critiques common misunderstandings and incomplete teachings of Gann’s work, particularly the overemphasis on geometry without integrating time, which leads to inaccurate or unusable trading strategies.

Main Ideas and Concepts

Importance of Forecasting in Gann’s Methodology Many Gann followers lack concrete forecasts to validate their methods. Forecasting is essential to prove understanding and practical application of Gann’s techniques. Ba shares that he provides forecasts on his own site (gantrade6.com) as an example of applying Gann’s principles.
Geometry vs. Time in Gann’s Work Gann’s methods are often misunderstood as purely geometric (angles/fans). Geometry in Gann’s system measures two components: price and time. Geometry alone is insufficient; it must be combined with understanding time cycles to know when price will respect or break through angles. Without time, traders cannot predict whether price will stop at or break through a Gann angle, leading to failed trades.
Support and Resistance Explained Through Angles
- Support: price resting or “walking up” an angle.
- Resistance: price below an angle that it struggles to break. Price action interacting with angles is influenced by time cycles signaling pivots or reversals.
Time Cycles Are the Key to Predicting Market Turns All major market turns are caused by time cycles. Gann emphasized that “time will arrest price” — price movements stop or pivot at specific time intervals. Examples of time cycles used by Gann include:
- 10-year cycle (10.5 to 11 years for wheat tops/bottoms)
- 50-year cycle (major price extremes)
- 7-year cycle and its multiples (14, 21, 28 years)
- 3-year cycle (34-36 months for major/minor tops and bottoms)
- Daily and monthly cycles (7, 10, 14, 20, 21, 28, 30 days; 30, 60, 90 months)

Not all cycles are active at once; identifying which cycle is dominant in a move is crucial.

Historical Validation of Time Cycles Ba references Gann’s own writings on wheat prices and stock market cycles. He highlights Gann’s 1929 stock market forecast, which was highly accurate (within one trading day 90% of the time). This forecast was based on time cycles and supply/demand analysis rather than geometry.
Gann’s Use of Squares and Time Counts Gann used squares of numbers (e.g., 25 = 5², 36 = 6², 49 = 7², etc.) as time counts on his charts. These squares marked important time intervals (weeks) from key lows or highs. This technique shows Gann’s integration of numerical/time relationships, not just geometric angles. Ba notes this use of squares is rarely discussed but is critical to understanding Gann’s approach.
Practical Trading Lessons Traders should avoid focusing solely on geometric angles. The priority is to study and understand time cycles. Geometry is a measuring tool, but the core of Gann’s forecasting power lies in the relationship between time and price. Proper forecasting requires identifying key time pivots and combining them with price geometry. Ba stresses the importance of replicating Gann’s forecasting accuracy and maintaining the sequence of highs and lows.

Methodology / Instructions Outlined

To apply Gann’s methods effectively:

Understand that Gann’s geometry measures both time and price.
Identify key geometric angles (support/resistance) but do not rely on them alone.
Master time cycles:
- Study major cycles (3, 7, 10, 14, 21, 28, 50 years).
- Study intermediate cycles (months, days).
- Learn which cycles dominate in specific market moves.
Use time cycles to predict when price will pivot or break through angles.
Incorporate Gann’s time counts using squares of numbers to mark significant time intervals.
Validate forecasts by comparing predicted dates with actual market highs/lows.
Avoid relying on hindsight geometry; focus on forecasting future pivot points.
Maintain the sequence of highs and lows (high-low-high-low) as a foundation for analysis.
Use multiple layers of analysis (time cycles, supply and demand, geometry) to confirm forecasts.

Speakers / Sources Featured

Ba – The presenter and narrator of the video, providing analysis and explanation of W.D. Gann’s methods.
W.D. Gann – Historical figure and original developer of the forecasting methodology discussed.
References to Gann’s writings and forecasts – Including excerpts from Gann’s pamphlets, supply and demand letters, and stock market forecasts from the 1920s and earlier.

In essence, the video stresses that W.D. Gann’s main methodology is not just about drawing geometric angles but fundamentally about understanding and applying time cycles in conjunction with price geometry to accurately forecast market turns. Time is the dominant factor that controls price movement, and mastering this is essential for any trader wanting to use Gann’s techniques successfully.