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Sunday, 23 June 2013

Matt Olsen (Gann Method )














I would like to share one very effective method which will help us in taking Positional and Intraday trade - but i prefer we should use it in a positional trade  to avoid less Whipsaw - the method will help us to scale the chart graphically in a more precise way and also help  us to use the trend line in a more accurate way 


The Method is Base on W.D.Gann and further developed by Matt Olsen (Thanks to both of them )

To use this method you should have a Square tool option in your software - I personally use Gannalyst software and it has that tool and i have also given a download link of this software  in my blog  

This Method takes into consideration the Previous swing major high and low points ( not the near ones but little extremes ones so that we can form a square 


First we should select the high and low points in such a way that it should form a square or rectangle 


once we plot the high and low in a chart we will get a square or we may het rectangle according to high and low formation 


Now from the left hand side (bottom) corner  of the square or rectangle draw a diagonal line which will intersect at right hand side (TOP) corner 


Now do the same thing from the left hand side (TOP) corner of the square or rectangle draw a diagonal line which will intersect at right side (bottom) corner 


The geometrical shape will give us two diagonal lines 

1) One upward trending Diagonal line and
2) Second Downward trending Diagonal line 













Once we get this diagonal lines we have to use the option in our software duplicate or copy so that we can get the same degrees of diagonal lines which we can use in the further swings 

For up trending swing use the up trending diagonal by placing the diagonal on the low of the chart once the low is formed (With Stop Loss)


And for down trending swing use the down trending diagonal by placing the diagonal on the high of the chart once  the high is formed (With Stop Loss)


When this diagonal are place we should see how the price behave to this diagonals and take position once the price crosses the diagonals on closing basis with stop loss 


This Method works very fine because its finds the natural harmonic and DNA of the the swing by taking past swing into consideration 


If we  Apply this Method on a daily or Weekly Chart we will get very good Tradable swings 


Please apply this method and let me know whether we can make any more improvements in this method 


Thank You