HARNESSING EXPLOSIVE MOVES USING GANN

JEFF GREENBLATT MTA WEBINAR MARCH 30, 2011

TECHNICAL ANALYSIS
Is Pattern recognition Traders lose money because they are emotional They get emotional because they dont understand the pattern Understand the pattern=greater opportunities Dick Arms: all fear and greed in pattern

COMMON FIBONACCI RETRACEMENTS

Once the domain of elite traders Now popularized by media outlets Its good for them but.. Once the crowd learns it No longer cutting edge So that is only our foundation We go way beyond Fibonacci

What We Will Cover Today

Pattern recognition Cycles and symmetry Price and time ratio squares Percentage change readings Median lines (pitchforks) Support and resistance Range squaring time Relevant current situations How to profit from this data (catching turns)

CYCLES ARE LEADING INDICATORS

Time dimension missing X factor to most people Can be anticipated in advance Eliminates need for lagging indicators In my work 262 week pivot at bull top was anticipated 6 months in advance as MOST IMPORTANT PIVOT OF DECADE

DOW 262 WEEK BULL MARKET

Pivot was anticipated 6 months in advance

COMMON FIBONACCI FORMATION

A is .60 of the whole correction/first summer 2007 bounce (DOW TOP)

SAME SEQUENCE
This time according to calendar days

TAKING IT ONE STEP BEYOND

Calendar day cycles-90 days (RUT-Dow top) Time retracement- 55.5 (calendar days)up = .616% Clusters with Dow all time high at 262 weeks These calculations are the underlying structure Always dig one level deeper

MOST IMPORTANT RULE:

WHEN PRICE AND TIME SQUARE THE TREND CHANGES DIRECTION

MOST IMPORTANT INTERNAL READINGS

Price and time square to get a ratio Ratio dictates when we are close or at a turn Cluster from various pivots Percentage change readings important part of equation

NUMBERS ARE LANGUAGE OF MARKETS

Fibonacci 5, 8, 13, 21, 34, 55, 89, 144, 233, 377, 610, 987 etc. Lucas 7, 11, 18, 29, 47, 76, 123, 199, 322, 521, 843 etc. Golden spiral, sq roots .618, 1.618, 2.618, 4.23, 6.84, .382, .786, 1.12, 1.27, 2.05, .236 Important Gann 45, 90, 180, 270, 360

MORE IMPORTANT NUMBERS

Geometric/Gann - 22.5, 67.5, 135, 225 315 Sacred Geometry 1.414, 2.236, 1.90, 1.1755, 3.14 Multiples of 144 288, 432, 576, 720 etc. Astronomic 88, 182, 188, 241, 365, 414, 615, 687

WHAT TO DO WITH THESE NUMBERS

Divide number of points into number of bars Ratio is the squaring of price and time Most pivots have some combination of these ratios Feel free to move decimal point Percentage change low to high or high to low Important application of Fibonacci #s

STUDY OF BEAR BOTTOM

Best percentage change readings Ive ever seen Russell was Gold standard Was only part of the story Cycles and symmetry goes back 21 years Importance to understand strength of the bottom pivot

KEY DAILY READINGS

Cluster of price and time=1.23 sq and 60%

PERCENTAGE % AT BOTTOM
Perfect symmetry from 3 pivots

DOW 87 CRASH RANGE

Range is 1108 points

NDX BOTTOM SQUARES DOW RANGE

1108 weeks; take note of parallels

INTRADAY TRADING
Price and time squares Best situations cluster with support/resistance Support/resistance could be retracement Always be aware of larger daily cycles Percentage change less important on intraday charting

MOST BASIC SQUARE

Numbers of bars ratio to points (5 min) 1-1 relationships are powerful setups

GANN GEOMETRIC ON 15 MIN

10 pts/55.5 bars completes .180 square

MORE NUMBERS=MORE OPPORTUNITIES

Ive always taught to look for Fibonacci/Lucas cycle symmetries When combining price/time we open up understanding to greater possibilities/profit opportunities with almost ANY SET OF NUMBERS Fibonacci/Lucas numbers are part of a greater overall ratio

TESTS OF FIBONACCI RETRACEMENTS

How do you trust a retracement? Give it a great square reading

NEXT SEQUENCE
Test of support (blue line) .260 reading

INTRADAY EXTENSION
2.618 extension last leg down/confirms with .359 reading

PRICE POINT MAGNETS

Action attracted to 610/618 price points

KEY PRICE/TIME SQUARE

360 bars off low @ .0061 pts per hour

KEY POINTS TO REMEMBER

These readings are the underlying structure of all markets They are leading indicators as we no longer need RSI/Stochastic/MACD, etc. We always wait for change of direction (no front running) 3 components before trading (support/resistance + square reading) And candlestick formation

BE CREATIVE
Nat Gas turned at .429 pts per day in 429cd

THE CALCULATIONS
Based on continuation chart at the time High was 15.517/low at 2.409 There was 305 td/429cd 15.517-2.409 = 13.108 13.108/305 = .0429 Bottom was on 429th calendar day Dont forget 61 weeks

NEXT TRADING SEQUENCE

Topped on a .0619 daily square

MAJOR 2010 SUGAR TURN

Nothing rare about 318 days up

UNLESS ITS UP 317 WEEKS

Cluster of 318 days/317 weeks caused turn

XAU HIGH @ 608TD

GOLD CASH TO 99 BOTTOM July/Aug double bottom

TEXTBOOK SQUARE
POT topped at 121.36 in 121 days

2009 BOTTOM IN CORN

Price 302 in 302 trading days/262 from secondary pivot/383pts=1.46sq

CORN PRICE/TIME SQUARE

Price point 302 in 302 days=RALLY

GREAT DEPRESSION PRICE/TIME SQUARE

2.326 and 89% drop makes this method timeless

INITIAL LEG OFF 80 SILVER TOP

3956/88d=44.95sq @ 78.55% (Month continuation)

SAME CASE STUDY

78.5/90%/127wks/35.89sq

LARGER DEGREE VIEW

Led to decade long low to early 90s

SUMMARY
Perfect price and time (Corn, Nat Gas and POT) rare but very important Every leg has some combination of price and time Markets spiral in all degrees of trend We take snapshots of these points in time and look for opportunity We use underlying structure to identify patterns

MEDIAN LINES
Help keep us grounded Give us a good visual on the trend Act as magnets to the price action When channel lines hit sentiment also changes

NOT VERY CLEAR

5 min Dow Emini

IS THIS MORE CLEAR?

Median lines give us GPS to pattern

WHY DID DOLLAR TOP LAST YEAR?

AT BIG MID LINE

BKX BOTTOM TARGET

Parallel warning lines excellent tool

FLASH CRASH THURSDAY

NDX bottomed out at 2 pitchfork levels lower

PARALLELS ON BOTH ENDS

Caught oil top and bottom both ends

CONFLUENCE READINGS/PITCHFORKS
Readings tell us if lines will validate

WHEN CHANNEL AND READING HIT HEADLINE MATERIALIZED

SUPPORT AND RESISTANCE

Polarity where support becomes resistance Resistance becomes support Important supply and demand points The A wave tendency

FORMER SUPPORT BECOMES RESISTANCE

POLARITY CONTINUATION

A WAVE POLARITY

SMALLER A WAVE

ADD PITCHFORK TO A WAVE

GARDNER STUDY
Studied musical savants (1973) Later found young children with access to elite training attained same levels as musical prodigies (1983) Conclusion: Innate gifts only potential for achievement

CHILD PRODIGIES
Never attain excellence as adults Studies according to Barlow (1952) Feldman (1986) and Scheinfeld (1939) Studies show most exceptional adult performers got instruction early and often

REQUIREMENTS
Passion/motivation Time, equipment and training Access to money Yours or acquired funds Dont give up

WHY STUDY UNDERLYING STRUCTURE?

Many traders have syndrome of win a few lose a few Only way to win is understand why you win Develop conviction with higher quality setups Put yourself in a position to let winners run

GANNS MOST IMPORTANT DISCOVERY

History repeats Past best predictor of future Squaring price/range and time Equal number of points balances equal number of periods Adapt universal principle to present day applications

Modern Era Squares

Gann didnt have to deal with multiple indices Modern markets more complex We must combine various indices to make this work All indices related to each other in some fashion

APPLICATIONS
Catch important turning points in key indices Buy and sell points in stocks Leverage information in important sectors Use in any market Knowledge in one area allows us to anticipate moves in related markets

DOW 87 CRASH RANGE

Range is 1108 points

BKX SYMMETRY

AMGN SETUP
6.55 range at 65 trading days

AMGN/BTK CONNECTION
AMGN Led whole sector up in Dec

RIMM CASE STUDY

Found trading low at 55.49 @ 55 days

RIMM NEXT SEQUENCE

High at 63.94 at 64 days

SYMMETRY ENDS CORRECTION

Drop ends at 6.46 after 64 sequence

DUSA PENNY STOCK

.42 correction in 41 days

SPECULATION GANN WINNER

Everyone wants a bio spec winner

CELGENE CASE STUDY

60.90 in 61.5 days off high/ low at 64days (creative variation of concept)

BIG DOW AUTUMN RALLY

SPX LONG TERM CHANNEL

NIKKEI 233 CONDITION

TRAINING PROGRAM
Cover materials from today in greater detail (3 major components) One on one attention from me Email correspondence go at your own pace Includes Gann square of 9 and Normally $747, 1 week special at $697

ULTIMATE GUIDE TO PATTERN RECOGNITION ROUGH CUT

We only had time for several chapters Adapted from the training program For the individual who doesnt want personal attention Covers Andrews, Gann ratio, Gann calendar, range/price square, sq of 9, support/resistance, trading strategies and psychology

MORE INFORMATION
www.Lucaswaveinternational.com fibonacciman@aol.com lucaswaveman@gmail.com