Charting and Studies User Guide - CQG.com

Page 176
Gann Lines (Gann)
What it does:
Designed by W.D. Gann, this technical study uses geometric angles in conjunction with time
and price. By maintaining equal time and price intervals, he theorized that certain geometric
patterns and angles could predict price action. Believing that an ideal balance of time and price
is produced when prices rise or fall at a 45-degree angle relative to the time axis, Gann
concluded that bull markets were identified by prices being above a trendline, and bear markets
were identified by prices being below the trendline.
The most important angle, consisting of a rise/run of 1x1 (always equal to a 45 degree angle, if
the x- and y-axes have equally spaced intervals), provides major support during an up trend.
When the trendline is broken, prices should be expected to fall to the next trendline, signifying
a major reversal. In other words, as one angle is penetrated, expect prices to move and
consolidate at the next angle.
CQG allows up to 10 Gann lines to be displayed. They are:
Pointer Tools
(N*N)x1 UP
(N)x1 UP
1x1 UP
1x(N) UP
1x(N*N) UP
1x(N*N) DN
1x(N) DN
1x1 DN
(N)x1 DN
(N*N)x1 DN
where N represents the Scale parameter. For example, if N = 2, the following lines would be
displayed: 4x1UP, 2x1UP, 1x1UP, 1x2UP, 1x4UP, 1x4DN, etc.
The Slope parameter is required to define the inclination for Gann lines. The Slope is the
amount of rise or fall, in minimum chart scale increments, of the line from a specified point on a
bar to the same bar on the following day. For example: a slope of 5 established on the 3rd bar
of a specific day on a US Bond Chart would be drawn through a point 5/32 higher on the 3rd
bar of the following day.