William D Gann is one of the most famous technical analysts among traders. One of the most complex trading systems, the Gann method includes price and time used to forecast future prices. Much of W.D.'s research Gann is about astronomy and arithmetic. It is rumored that he made over $ 50 million USD in his trading career.

Gann's 3 most popular trading tools are:

  • Gann Angles (or Gann Grid)
  • Gann Lines
  • Gann Fans

We can use the Gann tool in MT4 by going to Insert> Gann from the menu bar

Much of Gann's work relied heavily on Geometry and Gann's principle became popular and stated as follows: There is a perfect equilibrium when the price goes up or down at 45 degrees.

Trading with Gann Grid

Gann Grid is considered an indicator of the trendline indicator in the future. A grid is a square with two sides of time and price on a 45-degree angle of the trendline. When the price moves above the Gann trendline, the market is in an uptrend, and vice versa, when the price is below the Gann trendline, the market is in a downtrend. Gann Grid helps us to recognize the strength of a trend and also predict trend reversals.

To draw a Gann Grid, we need to connect two vertices or two troughs in a row (like drawing a trendline). The Gann Grid tool does the rest and creates the grids.

The chart above is a Gann Grid drawn when connecting two consecutive bottoms A and B. It should be noted that each line on the grid can be viewed as a trendline. There are no specific rules for connecting tops or bottoms. Markets are never perfect, Gann Grid can be adjusted to match current price action.

The chart above is an adjustable Gann Grid. Notice the bold lines in black. The Gann grid has been adjusted so that the current price is as close to the grid as possible. Gann Grid adjusts to give us a better market picture than simply connecting tops or bottoms.

Therefore, if we apply the principle of the uptrend is when the price is above the trendline and vice versa, we will see some interesting things. Zoom in on the chart and see how prices react to grid lines.

When the price runs along the Gann trendline, the trend is usually very strong, Gann said. The chart above illustrates how to enter a command based on Gann grid.

  • After drawing the Gann Grid, we wait for the price to break the trendline and retest to place a sell order. We see that the trendline has been broken at point 1.
  • The short-term support line was formed, so we wait for the price to retest at the trendline at point 3.
  • After the price returns to the resistance level and cannot cross the downtrend line, this is the confirmation to prepare to enter a sell order.
  • Enter a sell order when the price is below the downtrend line at point 4, the stop loss at the nearest peak, and take profit at the previously formed support level.
  • Or we can set a trailing stop when the price runs along the downtrend line.

Trading with Gann Fan

Gann Fan trendline is also used for trend trading with the trendline. Each line on Gann Fan is also seen as a trendline. We can place buy or sell orders when the price breaks these trend lines. The chart below illustrates Gann Fan. We just need to connect two vertices in a row, all that's left to do with MT4.

Whenever the price breaks the thresholds plotted in the chart above, we can place buy orders, cut loss at the previous bottom, and take profit at the upper trendline levels.

In summary, Gann trendlines are used to identify future support/resistance levels.

This article only introduces the Gann method at a very basic level. Trading with this method is quite complicated and takes a lot of time. Should trade a demo before fighting.

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