Definition
Gann Theory
Gann theory uses geometric angles, time cycles, and price-time relationships to forecast support, resistance, and turning points.
Developed by W.D. Gann, the approach combines angles (like the 45-degree 1x1 line), squares (such as the Square of 9), and time cycles to identify where and when markets may turn. It assumes price and time are linked and move in predictable geometric proportions.
Indian technical analysts apply Gann angles and the Square of 9 to Nifty, Bank Nifty, and stocks to project support, resistance, and reversal dates. Like Elliott Wave, Gann analysis is intricate and subjective, so it is best used alongside conventional support-resistance and price action rather than alone.
Related terms
- Fibonacci RetracementFibonacci retracement marks potential support and resistance levels at key ratios of a prior price move.
- Pivot PointsPivot points are calculated support and resistance levels derived from the previous session's high, low, and close.
- Elliott WaveElliott Wave theory holds that markets move in repeating cycles of five impulse waves followed by three corrective waves.
- Support and ResistanceSupport is a price level where buying tends to halt a fall; resistance is a level where selling tends to cap a rise.
Plain-English explainer from The Dispatch Investors Encyclopedia. General information, not financial advice.