William Delbert Gann

William Delbert Gann (June 6, 1878 – June 14, 1955), also W. D. Gann, was a trader recognized not only for his trading abilities, but also for his financial market forecasts. The accuracy of his forecasts is still the subject of substantial debate. Gann's son alleged that many of Gann's claims were fraudulent. Fact|date=June 2007

History

Gann, eldest of 11 was born in Lufkin, Texas on June 6, 1878. His father was a teacher who traded in Cattle and Horses. Gann’s mother taught him to read using the bible. It was at the age of 13 while selling newspapers and cigars on a train in Texas that Gann’s interest in the financial markets first developed. Every day he would overhear conversations about the markets from the passengers. He started trading in stocks and commodities in 1902, and in 1908 he moved to New York City and opened his own brokerage firm. His early trading career was far from successful and he went bust more than once. This impelled him to analyse the markets and claim successful predictions. Controversy surrounds his claims of trading successes and whether he did indeed reveal his real methods or whether he took his secrets to the grave. Believers swear that Gann was the 'real McCoy', and that his forecasting ability was, and is, legendary. Detractors claim that Gann was nothing more than a self-promoting huckster who was only interested in making money by selling books and trading courses.

Documented evidence from his time supports the claim that Gann was definitely on to something. In the month of September 1909, Gann allowed a newspaper reporter to follow along with him on the floor of New York Stock Exchange; the reporter claims to have witnessed Gann pulling off an amazing 92% winning trade ratio during those 30 days, a feat deemed to be virtually impossible by most professional traders, especially considering that he made over 250 trades during that month.

Gann claimed to have made over 50 million dollars in profits from his market forecasting and trading. After five decades of forecasting and trading, WD Gann moved to Miami, Florida where he continued writing, publishing, teaching, and studying the markets up until his death at 77 on June 14, 1955.

He claimed to base his market trading and forecasting methods on time, as well as on price, and said repeatedly that "time is the most important" when it comes to analyzing and forecasting market movements. He claimed to be able to determine not only "what" the turning-point's price would be, but also "when" it would occur. Gann was posthumously awarded the Market Technicians Association [https://www.mta.org/eweb/DynamicPage.aspx?webcode=annualawards Annual Award] in 1983, for his outstanding contributions to the field of technical analysis.

Gann and Astrology

According to Robert W. Colby, in The Encyclopedia of Technical Market Indicators, Gann "intensely applied astrology to market timing." At one point, Gann studied Indian sidereal astrology in India. In fact, the famous Gann wheel was first used by tea merchants in seventeenth century India.

Gann himself publicly admitted that he used Astrology for his market forecasting. However, the way he chose to do this was in the only novel that he wrote, 'The Tunnel thru the Air'. In this fictional novel (which some allege is a veiled autobiography of sorts), the hero of the book, Robert Gordon (who is the 'Gann' character in the novel) openly admits that he uses Astrology for his market forecasting.

A good overview of Gann and astrology is provided by the article “The Time Factor Of W. D. Gann” by James Smithson. The following is an excerpt from that article.

UMMARY

W.D. Gann’s outstanding skill was his ability to produce accurate annual forecasts of the stock and commodity markets. Gann stated that his forecasts were based on his secret “time factor”. However, careful analysis of his novel entitled “The Tunnel Thru The Air” reveals Gann’s belief in the overwhelming importance of astrology. Therefore astrology is the real basis of Gann’s annual forecasts. Indeed, astrological analysis is implicit at key points in his books and courses. Consequently it is concluded that if we wish to emulate Gann’s outstanding forecasting skills we must follow in his footsteps by firstly learning astrology and then apply this knowledge to the stock and commodity markets.

INTRODUCTION

William D. Gann (1878 to 1955) was an outstanding stock and commodities trader. He was also a prolific teacher of how to make speculation a profitable profession, writing some seven books and producing two courses on trading the stock and commodity markets. However, Gann’s superlative skill was his ability to produce annual forecasts of the stock and commodity markets one year in advance. Although he also sent his clients supplements, which corrected his annual forecasts when necessary, the overall accuracy of these annual forecasts is highly impressive. For example, Gann’s annual stock market forecast for 1929, which was published in November 1928, unequivocally forecast the “Great Crash” in the fall of 1929. However, Gann continued to produce and publish annual forecasts of the stock and commodity markets until shortly before his death in 1955.

THE “TIME FACTOR” IS THE KEY TO GANN’S FORECASTS

Gann’s forecasts of the stock and commodity markets were based on the “time factor”, the dictionary definition of which is “The passage of time as a limitation on what can be achieved”. Gann provided the following comments on the time factor:

“The most important thing of all is the Time factor, which I use in making up my annual forecasts. It is not my object here to give away that secret, but I am showing you plain enough and giving you rules enough that, if you follow them, you will be able to make a success in the stock market” (“Truth Of The Stock Tape”, 1923, page 116).

“Many people want to know what method I use to determine future indications on the market. I keep charts of the various active stocks and also a set of averages. My charts are different from the charts of the average statistician because they are based on a discovery of my own. I have discovered a ‘time’ factor that enables me to determine important tops and bottoms one year or more in advance. My annual forecasts on stocks, issued in December for ten years past, have proved remarkably correct. The cotton and grain markets can also be forecast by this ‘time’ factor, which enables me to tell when extreme highs and lows will be made, as well as the minor moves” (“Truth Of The Stock Tape”, 1923, page 41 of appendix).

“The time factor and time periods are most important in determining a change in trend because time can over balance price, and when the time is up the volume of sales will increase and force prices higher or lower” (“45 Years In Wall Street”, 1941, page 10).

“Time is the most important factor of all and not until sufficient time has expired does any big move start up or down. The time factor will overbalance both space and volume. When time is up, space movement will start and large volume will begin, either up or down. At the end of any important movement – monthly, weekly or daily – Time must be allowed for accumulation or distribution or for buying and selling to be completed” (“How To Make Profits In Commodities”, 1951, page 56).

Therefore we learn from Gann that:

1) The time factor is the most important element in forecasting markets; and therefore he used this time factor in producing his highly-accurate annual forecasts of the stock and commodity markets. 2) The time factor is so fundamental that it precedes (and therefore causes) changes in prices and changes in volume in the stock and commodity markets. 3) The time factor is a valuable secret, details of which he is unwilling to reveal. He is however prepared to teach trading rules which, when properly applied, produce profits in the stock and commodity markets.

GANN’S NOVEL ENTITLED “THE TUNNEL THRU THE AIR”

Although Gann was unwilling to explicitly reveal his time factor in his books and courses on trading the stock and commodity markets, he was prepared to leave strong clues in his novel entitled “The Tunnel Thru The Air”, which he wrote in 1927. This book describes the events in the United States leading up to the Second World War through the life of the principal character, Robert Gordon. Most importantly, in the foreword to this book Gann wrote, “‘The Tunnel Thru The Air’ is mysterious and contains a valuable secret, clothed in veiled language…..When you read it the third time, a new light will dawn. You will find the hidden secret…..The future will become an open book”.

Gann’s “valuable secret, clothed in veiled language” is that, as the Bible clearly states, astrology really works. This theme runs throughout the book and is highlighted in the following quotations:

“Robert was a great believer in Astrology because he had found this great science referred to so many times in the Holy Bible. He had made notes as he read the Bible at different times where it referred to Astrology or the signs in the heavens and was thoroughly convinced that the influence of the heavenly bodies govern our lives” (page 172).

“I believe in the stars, I believe in astrology, and I have figured out my destiny. The Bible makes it plain that the stars do rule” (page 66).

“Through my study of the Bible, I have determined the major and minor time factors which repeat in the history of nations, men and markets” (page 70).

“I have studied the Bible very carefully because I believe it is the greatest scientific book ever written. The laws are plainly laid down how to make a success. There is a time and a season for everything and if a man does things according to the time, he will succeed” (page 204).

“Robert had gone deeply into the Bible study in order to learn more about the great science of Astrology” (page 213).

“He read all the books he could get on astrology and began to understand why thing had happened as they had” (page 215).

GANN’S “TIME FACTOR” IS ASTROLOGY

As stated above, Gann’s forecasts of the stock and commodity markets were based on the “time factor”, which may be defined as “The passage of time as a limitation on what can be achieved”. Since astrology may be defined as “The study of the effects of the trends of time”, we see that time factor may be synonymous with astrology. It therefore appears that Gann preferred to state that his market forecasts were based on the “time factor”, rather than to state that they were based on astrology. Indeed, this is certain after carefully studying Gann’s book “The Tunnel Thru The Air” and identifying its “valuable secret” that astrology really works.

The reason for Gann’s secrecy is suggested in the following quotation: “It has taken me twenty years of exhaustive study to learn the cause that produces effects according to time. That is my secret and is too valuable to be spread broadcast. Besides, the public is not yet ready for it” (“Morning Telegraph” interview, December 1922).

Therefore Gann preferred not to reveal that astrology is the basis of his market forecasts for the following reasons:

1) The principle that astrology may be used to produce detailed forecasts of the stock and commodity markets is a valuable secret that had taken Gann much time and effort to master. 2) Gann firmly believed that his students should, like him, devote much time and hard work to their studies on how to make speculation a profitable profession. 3) Gann was well aware that the suggestion that the stock and commodity markets are governed by astrological influences is an astounding new paradigm, which violates the conventional wisdom and would therefore attract hostility. This is highlighted in the following quotation:

“It appears to be a fact that Mr Gann has developed an entirely new idea as to the principles governing stock market movements. He bases his operations on certain natural laws which, though existing since the world began, have only in recent years been analysed with precision and added to the list of so-called modern discoveries. We have asked Mr Gann for an outline of his work, and have secured some remarkable evidence as to the results obtained therefrom. We submit this in full recognition of the fact that a man in Wall Street with a new idea – an idea which violates the traditions and encourages a scientific view of the proposition – is not usually welcomed by the majority, for the reason that he stimulates thought and research. These activities said majority abhors” (“Ticker & Investment Digest” interview, December 1909).

GANN AND ASTROLOGY

Since Gann’s book “The Tunnel Thru The Air” reveals the “valuable secret” that astrology really works and, by implication, astrology is the basis of Gann’s stock and commodity market forecasts, one should look for evidence of the use of astrology by Gann in his other writings.

1. Gann’s Chapters On Forecasting In His Stock And Commodity Market Courses

Gann produced and sold separate courses for trading the stock and commodity markets. These courses overlapped to some significant extent. One chapter common to both courses is entitled “The Basis Of My Forecasting Method: Geometrical Angles”. An important quotation from this chapter is as follows:

“We use three figures in geometry, the circle, the square and the triangle. We get the square and triangle points of a circle to determine points of time, price and space resistance. We use the circle of 360 degrees to measure time and price. There are 360 degrees in a circle, no matter how large or small the circle may be. Certain numbers of these degrees and angles are of vast importance and indicate when important tops and bottoms occur on stocks and commodities, as well as denote important resistance levels. Every movement in the market is the result of a natural law and of a cause which exists long before the effect takes place and can be determined years in advance” (Stockmarket Course and Commodities Course).

The esoteric meaning behind this statement is as follows:

There are 360 degrees in any circle, the largest of which is the great circle of the heavens, or the zodiac. Certain points on this zodiac (identified by a precise number of degrees) are very important because they relate to specific stocks and to specific commodity markets. Consequently the angles between a planet and these specific points on the zodiac and also the angles between two planets are very important because they signify tops and bottoms in the stock and commodity markets. Two important angles (or “aspects”, as they are called in astrology) are the square (or 90 degrees) and the triune (or 120 degrees). Since the angles between a planet and a particular point on the zodiac or between two planets can be calculated years in advance, stock and commodity markets can in principle be forecast years in advance.

It is also important to note that the above quotation by Gann was in the introduction to his chapter on forecasting by means of “Gann angles”; i.e. forecasting by using the 1 X 1, 2 X 1, 1 X 2, etc. trendlines from important tops and bottoms on price charts. Therefore the very important implication here is that (as the chapter title suggests) the basis of Gann’s forecasting method was not merely the geometrical “Gann angles” drawn on a price chart, but (more fundamentally) the geometrical angles between planets and the zodiac (which is of course astrology). In summary therefore, Gann is suggesting that the angles between the planets and the zodiac in the heavens (i.e. astrological influences) cause the particular angle of a trendline on a price chart, and this is the real basis of his forecasting method.

2 Gann’s Emphasis On Anniversary Dates And Seasonal Tendencies In The Stock And Commodity Markets

Gann’s consummate book on the stockmarket was “45 Years In Wall Street” (written in 1949) and his consummate book on the commodity markets was “How To Make Profits In Commodities” (first written in 1941 and updated in 1951).

The common feature of both books is their emphasis on the importance of anniversary dates and seasonal tendencies, as the following quotations illustrate:

“My object in writing this book ‘45 Years In Wall Street’ is to give you some new and valuable rules on time periods which will help to guide you in determining high and low prices in the future. In my research work I have discovered that stocks make an important change in trend in the months when they reach extreme high and low. These are what I call anniversary dates, and these important dates should be watched each year for important changes in trend” (“45 Years In Wall Street”, page 92).

“It is very important to watch the date when an individual commodity makes extreme high or low. The first important time period to watch from any anniversary date is third or fourth month, then around the sixth or seventh month, where many important tops and bottoms are reached” (“How To Make Profits In Commodities”, page 58).

The esoteric meaning behind these statements is as follows:

Certain points on the zodiac (identified by a precise number of degrees) relate to specific stocks and to specific commodity markets. The sun is unique amongst the planets in that it completes one revolution of the zodiac every year. Moreover on any given day of the year the sun is in exactly the same position (in the zodiac) as it was on that day one year earlier, ten years earlier or a century earlier. Consequently the sun will aspect a particular point on the zodiac on the same day every year. This is the cause of seasonal tendencies in the stock and commodity markets (indeed, this is the cause of all seasonal tendencies on earth).

The important point to note here is that Gann emphasised the seasonal tendencies in the stock and commodity markets to encourage his students to think about and to identify the cause. The cause is the position of the planets, and in particular their angles to a specific point on the zodiac (which is of course astrology).

3. Gann’s Recommendation To Study Astrological Influences On The Commodity Markets

Amongst Gann’s surviving papers are his two “astrology letters”. More specifically, in January 1954 Gann wrote to one of his students recommending that he study the astrological influences on the soybean market (“The longitude of the planets and the longitude of the average of the planets determine the resistance levels as the price of soybeans moves around each cycle of 24 cents per bushel”); and in March 1954 he again wrote to his student recommending that he study the astrological influences on the coffee market (“By studying all of the (astrological) data outlined above and applying it to coffee, you will be able to learn more about what causes the changes in trend”).

Gann died in June 1955 and therefore these astrology letters are some of his last teachings. However, it is notable that in these two short letters Gann does not reveal any clear and specific method of astrological forecasting of the commodity markets. Instead, Gann encouraged his student to observe, experiment and learn for himself how the angles between the planets and their angles to specific points on the zodiac forecast the changes in price trends. Indeed, it appears that Gann had for over fifty years kept secret his method of market forecasting and at the age of 76 he was not simply going to reveal it to a student. Nevertheless Gann was continuing his lifelong practice of helping his students to make speculation a profitable profession by giving them guidance and letting them learn for themselves.

CONCLUSION AND RECOMMENDATIONS

1. W.D. Gann’s highly-accurate annual forecasts of the stock and commodity markets were based on astrology. Therefore, if we as investors and traders wish to emulate Gann’s outstanding forecasting ability, it is absolutely necessary that we learn astrology.

Although astrology may be learned from a variety of sources, the present writer recommends, as a first step, the correspondence courses in spiritual astrology taught by The Rosicrucian Fellowship, which may be contacted at International Headquarters, 2222 Mission Avenue, Oceanside, California 92054, U.S.A.

2. Once we have learned astrology, we must apply this knowledge to the stock and commodity markets. This task requires much hard work, as Gann himself observed:

“I soon began to note the periodical recurrence of the rise and fall in stocks and commodities. This led me to conclude that natural law was the basis of market movements. I then decided to devote ten years of my life to the study of natural law as applicable to the speculative markets and to devote my best energies toward making speculation a profitable profession” (“Ticker & Investment Digest” interview, December 1909).

However, Gann has provided us with specific guidance. In summary, we should obtain daily price charts which depict important tops and bottoms in the stock and commodity markets and we should then observe the following:

i) The angles between the planets (the most important of which is the 90 degrees, or “square”, angle); ii) The angles (especially the 90 degrees angle) between the planets and particular points on the zodiac; iii) The longitudinal position of the sun and especially its 90 degrees angle to particular points on the zodiac (because this causes the seasonal tendency in a particular market).

When we have mastered how astrological influences affect the stock and commodity markets, we will be in a position to produce accurate annual forecasts. Like Gann, we will then become the foremost speculators and traders of our generation.

3. Although there are many individuals and companies around the world claiming to teach “Gann analysis” through books, courses, videotapes and computer programs, they should certainly be avoided. This is because, since none of these individuals or companies can produce an accurate annual forecast of the stock or commodity markets, they do not in fact teach Gann’s real method”. End of excerpt from “The Time Factor Of W. D. Gann” by James Smithson.

=Gann and Sacred Architecture=

We know from an article in the Buenos Aries Herald dated 21st March 1935, which is reproduced in Gann's booklet "Scientific Stock Forecasting" (1936), that Gann visited Egypt and India. In that short newspaper article Gann stated that he had visited Egypt and India in order to research cotton cycles over the previous 400 years.

However, it appears that Gann's secondary aim, if not his primary aim, was to visit the pyramids of Egypt and the temples of India. For example, in his novel "The Tunnel Thru The Air" (1927) Gann states that the pyramids of Egypt "Were placed there according to a divine plan" (page 398). Moreover, on that same page Gann refers to the temples of India.

On the following two pages of his novel "The Tunnel Thru The Air" (i.e. pages 399 and 400) Gann refers to the pyramids of Mexico.

Also from Gann's booklet "Scientific Stock Forecasting", we know that in 1933 Gann bought a light aircraft and used it to travel extensively around the United States, and Central and South America in order to "Study cotton, wheat and tobacco crop and business conditions". For example, on one of these trips in 1935 Gann covered 18,000 miles by airplane and 1,000 miles by automobile.

It is therefore highly likely that during one of these trips Gann visited the pyramids of Mexico, which he had referred to in his novel "The Tunnel Thru The Air". More specifically, it is highly likely that Gann visited the Aztec pyramid complex at Teotihuacan and the Mayan pyramid complex at Chichen Itza.

The common feature of the pyramids of Egypt, the temples of India and the pyramids of Mexico is that they were all built by ancient civilisations and they apparently all encode advanced astronomical/ astrological knowledge. Therefore, since these pyramids and temples encode eternal spiritual knowledge, they are prime examples of sacred architecture. Indeed, Gann made precisely this point when he described the Egyptian pyramids as “Placed there according to a divine plan” (“The Tunnel Thru The Air”, page 398).

Moreover, Gann himself hints that he has made a study of the astronomical/ astrological properties of these ancient buildings: “The Bible tells us that God created the sun to give light by day and the moon to give light by night. The ancients worshipped the sun and built pyramids and monuments to the sun and the moon. They believed the sun to be God and the giver of life” (“The Magic Word”, 1950, page 74).

What therefore can we conclude about W. D. Gann and sacred architecture?

1) By carefully examining the stock and commodity markets over many years, Gann correctly identified the true principles of astrology (for a detailed discussion of this point, please see the article entitled “Rediscovering Gann's Law Of Vibration” by James Smithson).

2) Gann found corroboration of the true principles of astrology in the Bible. For example, in his semi-autobiographical novel “The Tunnel Thru The Air”, Gann wrote: “I have been studying the Bible night and day for many years, and I believe that I have found in it the key to all prophecy – the rules foretelling the events in the history of the country, the progress in invention and also rules for forecasting the future of stocks and commodities” (page 62); “The Bible points the way to read the signs and the stars” (page 69); “I hold that the Bible contains the key to the process by which man may know all there is to know of the future, if he will only seek diligently for the rules laid down in the Holy Book” (page 75); “Robert was a great believer in astrology because he had found this great science referred to so many times in the Holy Bible” (page 172).

3) Gann hypothesised that Christians were not the only (or even the first) group to correctly identify the true principles of astrology. Consequently he tested this hypothesis by visiting and studying the pyramids of Egypt, the temples of India and the pyramids of Mexico. Indeed, the Bible itself supports this hypothesis: “And Moses was learned in all the wisdom of the Egyptians, and was mighty in words and in deeds” (Acts, 7, 22; quoted by Gann in “The Magic Word”, page 16). Moreover Gann refers to the esoteric knowledge of the Indians (or, more precisely, the Hindus) in his books “The Tunnel Thru The Air” (page 264) and “The Magic Word” (pages 93 and 97).

4) If we wish to emulate Gann and become outstanding investors and traders we must carefully examine the financial markets in order to correctly identify the true principles of astrology. Corroboration of these true principles of astrology may be found in the Bible. These true principles of astrology may also be found encoded in sacred architecture such as the pyramids of Egypt, the temples of India and the pyramids of Mexico.

Gann And The Human Body

In January 1931 Gann wrote a short course entitled “The Human Body”. Indeed, this was in fact a one-page section at the end of a longer course by Gann entitled “Method For Forecasting The Stock Market”.

“The Human Body” by Gann has often perplexed students because it contains such statements as the following; “Woman is more perfect than man because she can create. Her body contains 12 openings. Man’s body only contains 11. The 12 represents the 12 signs of Zodiac. The fact than man’s body only contains 11 openings proves why a man betrayed Christ and not a woman”.

At first sight, Gann’s statement does indeed appear to be illogical or even nonsense. However, our initial response in trying to understand Gann should be to take a step backwards and to put this short course, entitled “The Human Body”, into context. By doing this we will note the following:

1) Gann wrote this short course, entitled “The Human Body”, in January 1931 when he was 52 years old. Gann’s career, as a highly successful stock and commodities market investor with an outstanding ability for accurate long-term financial forecasts, had by then lasted over 20 years (it may be viewed as having started around the time of his interview to “The Ticker & Investment Digest” in December 1909).

2) Some years earlier he had publicly forecast the contemporary economic and financial conditions. i) For example, in his semi-autobiographical novel, entitled “The Tunnel Thru The Air” (written in 1927), he wrote: “Robert calculated that from March 1931 until the end of June 1932 would be troublesome times for the United States. Depression, war and panic would hang over the destinies of his country. Robert had gone deeply into the Bible study in order to learn more about the great science of astrology” (page 213). ii) Moreover, in April 1930 (i.e. less than one year earlier) he had written his book “Wall Street Stock Selector” in which he stated: “The coming investors’ panic will be the greatest in history, because there are at least 15 to 25 million investors in the United States who hold stocks in the leading corporations, and when once they get scared, which they will after years of decline, then the selling will be so terrific that no buying power can withstand it” (page 203).

3) Therefore on 17th January 1931, as Gann wrote his short course entitled “The Human Body”, the Dow Jones Industrial Average had fallen from its peak of 386 (on 3rd September 1929) to 165 (i.e. a 57% fall). However, the DJIA would of course continue falling until it bottomed out at 41 on 8th July 1932 (i.e. a 75% fall from 17th January 1931 and a 90% fall from its peak). As stated above, in 1927 (in his novel “The Tunnel Thru The Air”) Gann had forecast that the coming depression would last until “The end of June 1932”, when in fact it lasted 8 days later (until 8th July 1932).

4) Gann realised that he had discovered a new paradigm for trading and investment. “It appears to be a fact that Mr Gann has developed an entirely new idea as to the principles governing stock market movements. He bases his operations upon certain natural laws which, though existing since the world began, have only in recent years been subjected to the will of man and added to the list of so-called modern discoveries ………. I know that he (i.e. Mr Gann) has a firm grasp of the basic principles which govern stock market movements, and I do not believe any other man on earth can duplicate the idea or his method at the present time” (“Ticker & Investment Digest” interview, December 1909).

5) Moreover Gann was confident that his paradigm, or methodology, worked in practise: “A man may evolve a beautiful theory for making money in the stock market, and he may try it out on paper and find that it works. It is apparently successful, but when he applies it to actual trading and begins to buy and sell, he then finds the weak point and the theory fails in actual practice. I know whereof I speak, for I have tried dozens of different theories, put my money down and lost; exploded the theory, discarded it and started all over again……After over twenty years of diligent study of the stock and commodity markets, I feel that I am competent to write something from experience that will prove valuable to others in actual practical trading. The fact that my method of forecasting has stood the test of time is sufficient proof that I have solved the problem” (“What Fits A Man To Write As An Authority” in appendix to “Wall Street Stock Selector”, 1930).

6) Finally Gann felt privileged to have received this gift of forecasting and he made an important comment on this in his semi-autobiographical novel “The Tunnel Thru The Air”: “Robert remained a few days longer at Silver Springs. Enjoyed being with Lady Bersford and told her of his understanding of the Bible and natural laws. She said that the pure, clean life he had led was what had brought him in contact with the spirits that had revealed to him the truth” (page 265). Indeed, Gann raised this important issue in the foreword of that book: “I believe this book will prove interesting and valuable to men and women in all walks of life. If it does, you will be thankful to the power that guided my hand in showing you the way to eternal truth” (foreword to “The Tunnel Thru The Air”).

Therefore we can conclude that on 17th January 1931, when Gann wrote his short course entitled “The Human Body”, he was 52 years old, he had been forecasting the stock and commodity markets for over 20 years and he was probably at the height of his forecasting ability. Moreover he was clearly confident that his method worked because it was apparently based on an eternal truth and he was keen to guide others along this same path.

Therefore, Gann’s fundamental aim in writing his short course entitled “The Human Body” (and indeed in writing all his other books and courses) was to show his students the way to eternal truth. In pursuit of this aim, Gann encouraged his students to think widely, deeply and creatively and to not necessarily be bound by the rules of conventional logic. This is apparently necessary in order to break out of the bounds of conventional wisdom, to identify a new paradigm and to thereby find the way to eternal truth.

Turning specifically to the quotation above from Gann’s course entitled “The Human Body”, here are some suggestions for its analysis:

1) Gann is implying that perfection and creation are associated with a complete set of all 12 signs of the zodiac. This is implicit in the following quotations from the Bible: i) “And Jesus answered him, saying, It is written that man shall not live by bread alone, but by every word of God” (Luke 4, 3-4, quoted by Gann in the introduction to his book “The Magic Word”, 1950). ii) “And he humbled thee and suffered thee to hunger and fed thee with manna, which thou knewest not, neither did thy fathers know; that he might make thee know that man doth not live by bread alone, but by every word that proceedeth out of the mouth of the Lord doth man live” (Deuteronomy 8,3, quoted by Gann on page 10 of “The Magic Word”). iii) “In the beginning was the Word, and the Word was with God, and the Word was God” (John 1,1, quoted by Gann on page 16 “The Magic Word”). This quotation from John 1,1 reminds us of a paragraph quoted above from Gann’s 1909 interview to “The Ticker & Investment Digest”: “He (i.e. Gann) bases his operations upon certain natural laws which, though existing since the world began, have only in recent years been subjected to the will of man, and added to the list of so-called modern discoveries”.

Thus, for the avoidance of doubt, “the Word of God” is synonymous with astrological vibrations, and hence astrology was apparently the basis of Gann’s forecasting ability.

2) Conversely, Gann is implying that those who do not benefit from all 12 signs of the zodiac/ “every Word of God” experience (amongst other things) suffering and betrayal, as implied by the following quotation: “Then certain of the scribes and Pharisees answered, saying, Master we would see a sign from thee. But he answered and said unto them, An evil and adulterous generation seeketh after a sign; and there shall no sign be given to it, but the sign of the prophet Jonas” (Matthew 12, 38 & 39, quoted by Gann on page 69 of “The Tunnel Thru The Air”).

3) Gann is also implying in this same paragraph that 12 is a perfect number, whereas 11 most certainly is not. Indeed, throughout his writings Gann emphasised the importance of the number 12 and its multiples because they represent natural support and resistance levels. Thus, for example, 12 x 4 = 48. 2 x 48 = 96. 2 x 96 = 192. 2 x 192 = 384. The importance of these “natural” support and resistance levels can be seen as follows: 1) The Dow Jones Industrial Average peaked at almost exactly 384 on 3rd September 1929 and on 13th November 1929 bottomed out at almost exactly 192 (i.e. 50% decline in 10 weeks). 2) The Dow Jones Rail Average peaked at almost exactly 192 on 3rd September 1929. They also bottomed out on 13th November 1929 but did not fall 50% to 96, but instead fell exactly one third to 128. 3) These examples illustrate not only the importance of natural support and resistance levels based on multiples of the number 12, but two other principles that Gann emphasised. Firstly that stocks and commodities make tops and bottoms in some exact mathematical proportion to other tops and bottoms. Secondly, financial markets move more rapidly at higher levels (and hence more slowly at lower levels).

4) Finally, if we believe that in this paragraph from his course “The Human Body” Gann is highlighting the importance of the zodiac/ astrological influences and also the number 12 and its multiples as natural support and resistance levels, then we should look for corroboration or confirmation elsewhere in Gann’s writings. We do indeed find this. More specifically, in 1954 Gann wrote to one of his students recommending that he study astrological influences on the soybean market: “The longitude of the planets and the longitude of the average of the planets determine the resistance levels as the price of soybeans moves around each cycle of 24 cents per bushel” (Gann astro letter, January 1954). Since Gann died 18 months later (in June 1955), this was one of his final lessons to his students. Moreover, it appears to repeat the same point (but somewhat more clearly) that Gann made in his “The Human Body “ course (written 23 years earlier).

Gann's Key Tools Of Analysis

1. Gann’s master mathematical price, time and trend calculator.

This is essentially a complex diagram on a piece of transparent plastic. It is used to overlay price charts and thereby analyze that particular market. The complex diagram on the transparent plastic comprises vertical lines (which are used to analyze time and to identify possible time cycles), horizontal lines (which are used to analyze price and to identify possible support and resistance levels) and diagonal lines (which are used to analyze the trend and to identify possible turning points in that market).

The importance of this device is that it succinctly incorporates a number of Gann’s key principles of analysis. For example, in a letter to one of his students in December 1952 (when Gann was 74 years old and shortly before he died), Gann wrote “For many years I have been working on a Master Mechanical Time and Trend Calculator which will not only save 90% of the work on charts but give accuracy in determining the trend, time periods and resistance levels. I finished this Calculator in September 1952 and have patented it. ……..You lay the Master Calculator on over your daily, weekly or monthly charts and it gives you the trend at a glance together with the next price or resistance level”.

2. Gann’s natural squares calculator (also known as the square of nine or the Gann wheel).

This device consists of a plastic base imprinted with an array of numbers (called the square of nine) surrounded by a circle showing the 365 days of the year. A separate transparent plastic circle is imprinted with a cardinal cross, a fixed cross, a square and a triangle. Much could be written about this natural squares calculator, but in summary:

· Gann’s aim in producing this device was apparently to encourage his students to study time and price at high and low points of the stock and commodity markets and simultaneously to introduce astrology by demonstrating the sun’s influence on financial markets during its annual geocentric transit through 360 degrees or the complete zodiac.

· Thus the real aim of Gann’s natural squares calculator was to encourage his students to think about and to study the impact of astrological influences on the stock and commodity markets.

· Therefore serious students of Gann should not spend too much time on this natural squares calculator because it is only an intermediate device. Instead, serious students of Gann should proceed directly to a comprehensive study of astrological influences on the financial markets.

Conclusion

In conclusion, serious students of Gann should focus on the hypothesis that Gann’s actual forecasting method was to employ his master mathematical price, time and trend calculator (i.e. the plastic chart overlay described above) in conjunction with astrology. In summary, astrological influences are the principal driver of a particular market (up, down or sideways), but the price action in that market unfolds in a coherent way which may be precisely forecast using this transparent plastic overlay on the price chart. Indeed, inscribed on this master mathematical price, time and trend calculator are two concentric circles (or “A wheel within a wheel”), which appear to be redundant but Gann includes them to symbolise the key complementary component of astrology.

Finally, both the master mathematical price, time and trend calculator and the natural squares calculator are included with the book “Gann Made Easy” by William McLaren.

Gann Applied to Stock Market Trading

For further reading on the subject of the application of Gann methodology to stock market trading see:

*"Gann Made Easy, by William McLaren".
*"How to Win as a Stock Market Speculator, by Alexander Davidson," page 253-255.
*"The life and work of W.D.Gann, by Solomon Thallon," page 1.
*"Pattern, Price & Time: Using Gann Theory in Trading Systems, by James A. Hyerczyk," page 19.
*"The Encyclopedia of Technical Market Indicators, by Robert W. Colby," page 108.
*"New Thinking in Technical Analysis: Trading Models from the Masters, by Rick Bensignor," page 14.
*"Predicting the Future: An Introduction to the Theory of Forecasting, by Nicholas Rescher," page 23.
*"The Technical Analysis of Stocks, Options and Futures, by William F. Eng," page 345, 371.

Books and Articles by W D Gann

* "Tunnel Thru The Air, or looking back from 1940"
* "Truth of The Stock Tape"
* "Wall Street Stock Selector"
* "How to Make Profts Trading in Commodities"
* "45 Years in Wall Street"
* "Magic Word"
* "How to Make Profits Trading In Puts And Calls" (an early text on trading options)
* "Face Facts America"

Famous Gann Quotes

W.D. Gann is no "Wall Street tipster" sending out market letters and so-called inside information. Mr Gann's results are obtained by profound study of supply and demand, a mathematical chart of money, business and commodities. He determines when certain cycles are due, and the order and the time when market movements will follow.

"The Morning TelegraphSunday, December 17, 1922."

The man who is right 6 times out of 10 will make a fortune. Gann is a trader who established a record of over 92% profitable trades.

"James R KoeneThe Ticker and Investment Digest (later became the Wall St Journal). December 1909."

I am now in my 72nd year; fame would do me no good. I have more income than I can spend for my needs, therefore, my only object in writing this new book is to give others the most valuable gift possible KNOWLEDGE! If a few find their way to make safer investments my object will have been accomplished and satisfied readers will be my reward.

"(Gann, W. D., 45 Years in Wall Street, Lambert-Gann Publishing Co., Pomeroy, WA, 1949, Forward, p. 2.)"

I then decided to devote ten years of my life to the study of natural law as applicable to the speculative markets and to devote my best energies toward making speculation a profitable profession. After exhaustive researches and investigations of the known sciences, I discovered that the law of vibration enabled me to accurately determine the exact points at which stocks or commodities should rise and fall within a given time.

"WD Gann"

I have not only put in years of labour in the regular way, but i spent 9 months working night and day in the Astor Library in New Your and in the British Museum of London, going over records of stock transactions as far back as 1820.

"WD GannDecember 17, 1922."

ee also

*Technical Analysis
*Gann angles
*Financial astrology

External links

* [http://www.traderslog.com/ganninterview.htm Interview with W.D. Gann By Richard Wyckoff]
* [http://www.market-analyst.com/videos/wdgan/WDGann.wmv A short video presentation on the life of W.D. Gann]
* [http://www.davidyap.net WD Gann Theory in Chinese ancient astrology ways]