A technical analysis tool developed by W. D. Gann. To draw an ascending Gann Line, attach the tool at a major bottom and drag the mouse to a higher bottom.
The resultant ascending trendline is drawn at an angle of 45 degrees.
To draw a descending Gann Line, attach the tool at a major top and drag the mouse to a lower top.
The resultant descending trendline is drawn at an angle of 45 degrees.
On the Gann Line, there are three control points. By moving the first and the last points the slope and the length of the line may change. By moving the middle point, the line may be moved without changing its slope and length.
According to Gann’s theory, prices:
- above the ascending 45 degrees line indicates a strong upwards movement.
- below the ascending line implies a possible change in trend direction.
- below the descending 45 degrees line indicate a strong downwards movement.
- above the descending line implies a possible change in trend direction.
- on the 45 degrees line shows a market in balance i.e. one unit of price corresponds to one unit of time.
