Gann Rules for Swing Trading

Gann Techniques are technical analysis tools that were developed by the renowned financial trader William Delbert Gann (WD Gann), during his career on Wall Street which spanned the first half of the twentieth century.

As per the Gann technique goes, we have been given certain rules which are known as Gann techniques. The most interesting aspect of this is that regardless of the time it holds true across all the markets.

Important Gann Rules for Swing Trading: –

1. If a high price of any week is achieved on Friday, then expect higher prices in the next week.

2. If the low price of the week is achieved on Friday, it indicates lower price next week.

3. In a highly up trending market, weekly lows are generally achieved on Tuesday.

4. If a price crosses the high of the last 3 days at least by 0.5% of Stock Value, it is a buy signal on the fourth day and the stop loss to be placed below low the 3 day high.

5. If the low of the last 3 days is broken by 0.5% of Stock Value then it is a sell signal on the fourth day. Sell the stock on the fourth day and keep a stop loss below  last 3 day low.

6. If the subsequent correction is greater than the previous correction, both in terms of price and time magnitude, then it is an early signal of a trend reversal.

7. If the main trend is up, correction will not last more than 4 weeks.

8. If the main trend is down, no retracement rally will last for more than 4 weeks.

9. If the price is constantly rising for 5 days, then there is every chance that correction will last for at least 3 days. Time frame could be any. The ratio is 5:3.

10. Once price is in a consolidation phase, suddenly one day there is a volume spike, it is an early indication that trend might change.

11. If a market is constantly rising for 9 days, there is an every chance that a correction would last for 5 days. Time frame could be any. Ratio is 9:5.

12. In a highly trending market once price closes below 30 DMA and remains below at least for 3 consecutive days, it foretells that further correction to be continued.

13 Whenever a stock rising from a level of 100% , it will becomes a strong resistance.

2 thoughts on “Gann Rules for Swing Trading”

  1. Sir, there is a situation with ADANIENTERPRISES where both rule number 1 and rule#5. then what to do..
    rule#1 says , higher price next week and rule#5 says sell signal. please explain what to do in this case.i was about to take sell position.

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