# What Are Gann Angles & How To Trade With Them

William Gann is one of the largest traders of the twentieth century, famous for inventing a unique methodology for predicting the development of market trends, which is now commonly called “Gann Methods.” Gann angles are one of the effective tools for analyzing and predicting price behavior. The method is based on the analysis of changes in the graph relative to lines constructed from extremes at certain angles.

## What are Gann Angles?

Gann Angle lines are drawn at different angles from the important top or bottom on the price chart. Gann believed the 1×1 trend line to be the most important level. The position of the price curve above this line is a sign of a bull market, and below it is considered a bear market. Gann believed that the 1×1 angle is a powerful support line in an upward trend, and considered a breakout of this line as an important reversal signal. Gann identified the following nine main angles, among which the 1×1 angle is the most important:

• 1×8 – 82.5°
• 1×4 – 75 °
• 1×3 – 71.25°
• 1×2 – 63.75°
• 1×1 – 45°
• 2×1 – 26.2°
• 3×1 – 18.75°
• 4×1 – 15°
• 8×1 – 7.5°

For the considered ratios of price and time growth to have corresponding slope angles in degrees, the X and Y axes must have the same scale. This means that the unit interval on the X-axis (i.e., hour, day, week, month) should correspond to the unit interval on the Y-axis. The simplest way to calibrate the graph is to check the angle 1×1: 45 degrees.

Gann noted that each of the above rays could serve as support or resistance depending on the direction of the price trend. For example, in an uptrend, a 1×1 angle is usually the most important support line. A fall in prices below the 1×1 line indicates a trend reversal. According to Gann, then prices should fall to the next trend line (in this case, it is a 2×1 ray). If one of the rays of the Gann Angle is broken, we should expect price consolidation near the next angle.

## How to use Gann Angles?

The analysis of angles is based on the main principle – all price movement occurs from one corner to another.

So, breaking down the line of one ascending angle, the price tends to the following. It doesn’t matter how it goes to the corresponding corner; the price, in principle, may not reach the corner, it is not obliged. But what very important is, the angles for the price are like magnet, and they somehow pull the price to themselves.

This fact is just laid down in the basic rule of angles that the price, breaking one corner, will tend to approach another.

The same can be seen on the downward fan of the Gann angles:

However, attention should be paid to the the Gann angle rule (if the price has broken a corner, then it will tend to the next corner). As this is far from a practical trading strategy.

This rule is not for trading. This rule will greatly help us in analyzing the price chart. With it, we can determine for ourselves where the price is now and what we should do exactly if the price goes one way, and what we could do if the price goes the other way and so on.

Gann analysis has been used by traders for decades. It is a popular, intricate method for analyzing the direction of a commodity or stock. The basic construction of Gann angles remains the same while some recent changes have become necessary to adjust a few key components in pricing levels and volatility. Gann angles measure pattern, price and time frame.

Anyone can use Gann’s theory in the forex market. All you got to do is wait until the top and bottom values start to appear on the charts. As soon as these trends change, you will be able to draw an angle, which is the geometric or Gann’s angle. The forex market is assumed to be strong when the value of the currency pair is above the ascending angle and the trend in the market is up. Similarly, the market is weak when the currency pair price goes below the descending angle and the trend for the same is also down. This means one can determine the trend in the forex industry with the Gann’s angle indicator.

Gann Angles are not as easy other statistical indicators. However, we try to provide a basic trading based on 1X1 level.

• You can buy an asset if the price is above the 1X1 level whether it breaks out of the level get a pullback.
• You can place your stop-loss slightly below the swing low.
• You can place take-profit on the next level on the upside.

### Gann Angles sell strategy

• You can sell an asset if the price is below the 1X1 level whether it breaks out of the level get a pullback.
• You can place your stop-loss slightly above the swing low.
• You can place take-profit on the next level on the downside.

## Gann Angles conclusion

W.D. Gann’s techniques can be drawn on a chart manually or applied through a computerized technical analysis package found on many computers. Gann angles are often compared to trend lines, but in reality, they are not the same thing. A Gann angle is a diagonal line which moves at a uniform rate of speed. A trend line is created by connecting bottoms to bottoms to form an uptrend, and tops to tops to form a downtrend.

Gann Angles are quite complex when it comes to placing them on chart. However, there are ways to properly place them as the rules have been already established. The 1X1 level is of utmost importance it can significantly help to determine the trend of a market.

If you are looking to trade forex online, you will need an account with a forex broker. If you are looking for some inspiration, please feel free to browse my best forex brokers. I have spent many years testing and reviewing forex brokers. IC Markets are my top choice as I find they have tight spreads, low commission fees, quick execution speeds and excellent customer support.