dave on Nostr: WD Gann's trading approach was based on a set of mathematical and geometric ...
WD Gann's trading approach was based on a set of mathematical and geometric principles that he believed could be used to predict future price movements in the stock market. Some of the key principles he used include:
1. Time cycles: Gann believed that the market followed predictable cycles of time, with certain price movements occurring at specific intervals. He used a variety of techniques to identify these cycles, such as drawing lines on charts to identify key dates and looking for repeating patterns in historical price data.
2. Price levels: Gann believed that the market had certain price levels that acted as support or resistance, meaning that prices were likely to bounce off these levels in predictable ways. He used tools like trend lines and Fibonacci retracements to identify these levels and make trading decisions based on them.
3. Geometric patterns: Gann believed that the market followed certain geometric patterns, such as squares, circles, and triangles, that could be used to predict future price movements. He used techniques like charting and mathematical calculations to identify these patterns and make trading decisions based on them.
While it is difficult to generalize these principles to the laws of physics, they do share some similarities with certain branches of physics, particularly in the field of chaos theory. Chaos theory holds that complex systems, such as the stock market, can exhibit certain patterns and behaviors that are not immediately apparent, but can be identified through the use of mathematical and statistical tools. This approach has been used to study a variety of complex systems, including weather patterns, fluid dynamics, and even the behavior of the human brain. In this sense, Gann's trading system can be seen as a precursor to the use of mathematical and geometric principles in the study of complex systems.
1. Time cycles: Gann believed that the market followed predictable cycles of time, with certain price movements occurring at specific intervals. He used a variety of techniques to identify these cycles, such as drawing lines on charts to identify key dates and looking for repeating patterns in historical price data.
2. Price levels: Gann believed that the market had certain price levels that acted as support or resistance, meaning that prices were likely to bounce off these levels in predictable ways. He used tools like trend lines and Fibonacci retracements to identify these levels and make trading decisions based on them.
3. Geometric patterns: Gann believed that the market followed certain geometric patterns, such as squares, circles, and triangles, that could be used to predict future price movements. He used techniques like charting and mathematical calculations to identify these patterns and make trading decisions based on them.
While it is difficult to generalize these principles to the laws of physics, they do share some similarities with certain branches of physics, particularly in the field of chaos theory. Chaos theory holds that complex systems, such as the stock market, can exhibit certain patterns and behaviors that are not immediately apparent, but can be identified through the use of mathematical and statistical tools. This approach has been used to study a variety of complex systems, including weather patterns, fluid dynamics, and even the behavior of the human brain. In this sense, Gann's trading system can be seen as a precursor to the use of mathematical and geometric principles in the study of complex systems.