What role does price symmetry play in W.D. Gann angle analysis? First of all I am no home-trader by any means, I am barely a day-trader. My trader friend said that you believe that angle analysis tells something about the actual trading value and that the only things that are consistent are price moves and volume. So can it really tell something about price moves or do you think that the news just affects volume and not prices? I am a bit confused since he said that you rely on “price moves” which is consistent for me and volume with the news but that you think that the news just can affect volume but that it doesn’t effect prices. So where does the role of price in stock market moves come into it? Re: Role of price symmetry play in W.D. Gann angle analysis? Originally Posted by Arun First of all I am no home-trader by any means, I am barely a day-trader. My trader friend said that you believe that angle analysis tells something about the actual trading value and that the only things that are consistent are price moves and volume. So can it really tell something about price moves or do you think that the news just affects volume and not prices? I am a bit redirected here since he said that you rely on “price moves” which is consistent for me and volume with the news but that you think that the news just can affect volume but that it doesn’t effect prices. So where does the role of price in stock market moves come into it? For each momentum line, Gann (as well as other technicians such as Bollinger Bands, etc.) must make assumptions as to what (the magnitude and direction) price movements are consistent with each level of resistance and support. It is not necessary to make the assumptions in the post-opinion lines of support/resistance.

Market Harmonics

As for being consistent with price moves… Prices provide the foundationWhat role does price symmetry play in W.D. Gann angle analysis? W.D. Gann’s original angle analysis did not involve price symmetry at all. As the Wikipedia story states, “it is difficult, however, to find a particular reference suggesting Gann’s awareness of the notion”. I try not to look that skeptically as I don’t want to think that the likes of William Jaffray II couldn’t be as informed as he was about an essential property of any asset, but I’m left to conclude that it’s up to the reader where W.D. Gann sits in the space of all things worth looking at in analysis! Although, the fundamental goal, when looked at from a longsighted perspective is to find ways to achieve desirable outcomes that aren’t obvious otherwise, by way of realizing returns to shareholders- and therefore, even from my biased perspective, trying to figure out ways to utilize something that’s known to be essential to be a success can’t be seen as a “low-road” approach to investing. It’s just what you’re doing with the asset that matters.

Financial Geometry

Price symmetry does not take away from Gann’s original analysis, but it’s a detail that I find important to look at as we continue W.D. Gann’s legacy and contribute to adding aspects to this work through the years. But why is price symmetry important aside from adding to the original analysis? How and why can I conclude that it’s necessary? Is it useful to think about more helpful hints you assess a position in the face of price symmetry… and how you can employ that insight to aid in your decision making? Consider a simple example of a Venn diagram in which two circles intersect to show the two positions in an asset class. On one hand, a “stamp” of many companies’ price histories and future trajectories are represented. As you walk around that Venn diagram, you can pick a valuation on the stamp based on price history (since volatility is not the end decision maker when entering a “price opportunity”). On the other hand you have a volume position on a “lead-like” product – an “asset” priced to flow (based on supply and demand- and typically those valuations are driven by the flow the user perceives a market/customer needs in that product). So here are a couple of simple examples of an asset where price symmetry really holds. The most compelling argument to me is the fact that if a position is cheap to buy now and it’s cheap to buy now without any analysis past that level, it stands to reason that should a downward correction in price ensue, it’s likely that the same price at an earlier point in time was a purchase price, assuming price was higher as the asset flowed. The same argument that I can tell you the exact price of an option at today and that you can point me back down the time-line, I can also tell that at a certain point in the time line you can still buy at today’s price.

Time and Price Squaring

That still stands. That’s really what the fundamental argument is about, rather than trying to say that it’s necessary in order to consider angles (using that symbol ‘a’ that some seem to use). I’m quite content the way Gann did it the first time around. The most convincing argument for focusing your analysis on an asset that historically has performed nicely- not on something that could be done as well using paper and pencil if you want to be lazy- is the simple fact that it isn’t true for all assets… and the nature of the decisions involved. The asset that cannot be analyzed due to their complexity (that are not only required to justify conclusions but do so in advance, especially in the HFT and quantitative finance space) do not provide a good basis to look for a more viable decision for those reasons. Gann’s historical roots and analysis stood the test of time and served as a basis for the modern quantitative financial firm. IWhat role does price symmetry play in W.D. Gann angle analysis? The short answer is just what you would get if you looked at W.D.

Sacred Numbers

Gann charts upside down. If an asset’s YTD return closely matches the aggregate rate of return of its peers, the prices will tend to tend to converge toward a symmetry-free mean. This means that to the extent that the price is overbought or oversold, the accumulation or distribution of cash relative to the accumulated base of the asset will be mismatched. And with W.D. Gann charts, it gets even easier, since we can look at the Gann angle, and we can tell if the price is overbought or oversold. For today, let’s turn to the monthly chart of the three ETFS I highlighted back in my February article. By looking at the price chart and analyzing the relative gain YoY, we immediately determine that the ETF is overbought. (Although, you may want to look at the 5- and 10-year charts here and check whether we are being over-optimistic.) A quick glance at the Gann angle shows that the price is well-distressed. When we average the Gann angle over time, we get (Gann Angle – 1.09863) / TimeLength, or 0.5957 per month.

Gann Angles

Is our assumption correct? Yes. At least I think so. But clearly, a 30-day Gann angle above 5% is enough to confirm the direction of price change. So, if you had a position in March, and that position was exposed to the market on April 3rd for profit and loss, at how much did you lose? The answer is 15.3%. If your loss was due to price being oversold instead of being overbought, you would only lose 10.8%, so the potential impact is pretty dramatic. But, I digress— W.D. Gann angle analysis is a great starting point. For example, we can analyze the chart of QQQQQQ to confirm that VXX is overbought. In this case, the quick view is enough to confirm it. But ultimately, to really bring out the full potential of Gann angle analysis, we need to look at it over three times the length of the chart.

Gann’s Square of 144

And if we need to do something different than looking at the Gann angle at the beginning-of-the-day/middle-of-the-day, then we’ll need to modify the chart to accommodate for that. The problem is, we always need to plot the market index in the same time period as the current return. For example, here we have the SPY’s price chart of Q