Gann line

The Gann line is a line drawn at an angle of 45°. The author of this concept is William D. Gann, he was a successful broker and was involved in the sale of stocks and various commodities.

In his work, he used mathematical and geometric rules for analysis.

A trader's work is based on the relationship between time and price. In his research, he attached great importance to the largest and smallest points. Gann line is a trend line that is drawn from the maximum segment or minimum at an angle. Angles are calculated based on cost and period. When constructing an angle of 45° on an increasing graph, the minimum point is determined and a line is drawn upward. In a downward trend, from the highest point there is a line to the right and down. The Gann line provides for an equal correspondence between time and cost.

According to Gann Theory, a line with a 45° slope is a long-term trend line. If the price is above the rising line, the market is in a bullish trend. If the price is below the falling line, the market is in a bearish trend.

When the Gann Line intersects the price chart, it indicates a reversal in the overall trend. If, during an uptrend , the price falls to the Gann Line, the price and period are in balance.

A further breakout of the Gann Line from top to bottom may indicate an imbalance and the emergence of a flat or a new, downward trend. To plot this line, a standard tool is typically used, located in the trader's terminal, under the "Insert" menu at the top.