Gann Fan

Lines of Gann Fan are built at different angles from an important base or peak at the price chart. The trend line of 1?1 was considered by Gann the most important.

If the price curve is located above the 1x1 line it is considered to be the indication of a bull market. If the price curve is below the 1x1 line it is considered to be the start of a bear market. Gann thought that the ray of 1x1 is a powerful support line when the trend is ascending, and he considered the breaking this line as an important turn signal.

Gann emphasized the following nine basic angles, the angle of 1x1 being the most important of all:

• 1?8 : 82.5 degree
• 1?4 : 75 degree
• 1?3 : 71.25 degree
• 1?2 : 63.75 degree
• 1?1 : 45 degree
• 2?1 : 26.25 degree
• 3?1 : 18.75 degree
• 4?1 : 15 degree
• 8?1 : 7.5 degree

The considered ratios of price and time increments to have corresponding angles of slope in degrees, X and Y axes must have the same scales. It means that a unit interval on X axis (i.e., hour, day, week, month) must correspond with the unit interval on Y axis. The simplest method of checking that this holds trues is to check the angle and slope of the 1x1 ray in the Gann Fan, which must be 45 degrees.

Each of the above-listed rays of the Gann fan can serve as support or resistance lines depending on the direction of the price trend. For example, if the price trend is ascending then the ray of 1x1 is usually the most important support line. If price then falls below 1?1 line, it is a signal that the trend is turning. According to Gann, prices should then sink down to the next trend line (the ray of 2?1 in this case). In other words, if one of rays is broken then the price consolidation should be expected to occur near the next ray.

• Multiple, guided Gann fans may be drawn anywhere onto the chart area
• Value to use as basis for Gann fans (open, low, high, close, adjusted close)