how to draw Gann Swings correctly?

Discussion in 'Technical Analysis' started by traderkay, Jan 27, 2003.

  1. I'm trying to learn to draw Gann Swings correctly. It's a simple concept but there's some ambiguity on the actual drawing of the swings, if it's done manually. It comes from the questions like "how do you define swing high/low?" and existence of outside/inside bars, etc. I'm posting a chart of ES. Could you please re-upload it with your version of swings drawn (as simple lines) and if you could some commentary. Thank you.
     
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  2. the hyerczyck book "pattern, price & time" has some ideas.
    the point of swing charting is dropping the bars and getting a plot from minor low to minor high to minor low to minor high... i don't think swing charting should be used alone anyway, but it gives additional probabilities and a nice link to elliott wave theory.
     
  3. nkhoi

    nkhoi Moderator

    "Buying and selling becomes about equal and the market narrows down, then activity starts one way or the other and you should go with it. Of course, there are bound to be false moves at times. After accumulation is shown some news may develop which will cause a sharp drive down, followed by a quick rebound. Then if prices go above the levels previously established, you can consider that the move has reversed and that prices will continue upward."

    W. D. Gann, The Truth of the Stock Tape, pp. 35, 52, 67, 85, 122, 125-126, 165
     
  4. CWU

    CWU

    Three higher highs to swing up, and three lower lows to swing down.
     
  5. CWU

    CWU

  6. Thanks a lot, CWU. First I have a couple of clarifications to make.

    1) When we're looking for (say for example 3 higher highs), the 3 highs have to be higher in sequence like swinglow'sH<H1<H2<H3, right?
    2) The mentioned highs do not have to occur immediately after the suspected swing low bar nor do they have to occur in a time sequence (meaning the bars with H1, H2, H3 are 3 in a row). They can occur at any time after the suspected swing low, as long as 1) holds true. Right?

    Looking at your second posted chart (the one requiring only 2 H/L) I noticed a difference in how me and you would mark it up in one particular area. I'm posting that particular area and would like to hear your comment on this difference.

    Also I'm posting another chart (of today). If you could mark this beast up for me (in both 3HL and 2HL versions), I'd be very grateful and promise to lay off you:)

    By the way are you using this Gann Swing technique (the one described at fib.trader site)? If so what have been your experiences?

    Thanks you.
     
  7. And the new chart for marking up here.
     
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  8. CWU

    CWU

    Hello Traderkay,

    You are right, the highs or lows (2 or 3) must occur in consecutive sequence, regardless of where the begin.

    I had two telephone conversations with Mr. Krausz and one e-mail on chart construction. He was very kind to review my hand charts and then answer my questions.

    My 2 high chart is "Right" by his method becuase a single bar can count both as a higher high and a lower low.

    Now, I create my charts from TC2000 eod data. Sometimes a bar will appear not lower visually but when you place the pointer on it -- it is in fact lower (or higher depending on the situation).

    So, regarding the chart you are posting tonight, there are too many highs and lows that are too difficult to determine which is high or low. For that reason I only swing when it is obvious.

    Here's the 3 high or low.
     
  9. CWU

    CWU

    And, the 2 high or low swing.
     
  10. CWU

    CWU

    I drew the two swing too late in the evening after a strong gin&tonic. I see a miss. I'll fix it later.
     
    #10     Jan 29, 2003