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The accuracy of the data is not the point of my post. I do NOT disagree with
your take on day trading. As far as I can tell its as good as any, maybe
better than most. However, I'm sure that if you learned something that
improved your trading you wouldn't object to using it.
The point is that much misinformation and misunderstanding is propagated
about Gann and what Gann did. Very little of what Gann actually wrote in his
books is ever mentioned in contemporary trading information found here and
elsewhere. People hear little snippets about Gann and go around repeating
them like they know all about it. While I'm not an official on Gann, I can
apply what he wrote in his books.
I believe that Gann's contribution to trading was to add structure to
understanding price and time movements. If what he said in his books is
applied you get a very uncomplicated approach to understanding the markets.
Gann was not plotting lunar charts, squaring charts, or drawing fans when he
was on the floor of the exchange. He obviously had to follow a simple set of
guidelines when he traded there.
That is what I'm trying to show with my little chart. Ignore the Gann fan
and just look at the colored bars that show what Gann said about trend. If
you followed those rules the trend was your friend on that day and many
other days as well.
Prosper
> All I can say is that I traded off the data I had and I made the decisions
accordingly. I do not know why your data would show the exact inverse to
mine and I wonder if anyone else on the list can throw some light on the
matter. I have not been to the CBOT website to check, but I am sure my data
is not that far out - a tick or two maybe, but not a completely different
set of data.
This brings up an interesting point, however. Assuming my data was correct,
what does that do to your Gann fans? I know nothing of Gann or how you set
it up on charts, let alone read and rely on it for actual trading. My own
concept is based on what the market has actually done, in terms of
resistance and support levels. I find it essential to work from what
traders have actually exectuted, where they have bought and sold in the
market.
Having said that, I most certainly measure retracements with Fibonacci
numbers, as my standard. But such measurements have to be tempered with
what is actually in the market - the resistance or support points, as they
have developed and are rated, as it were, by the pit.
On the day in question, the market opened and formed (according to the tick
data coming in on my machine!) a bullish wedge just below a most significant
line of resistance. It took a couple of bars to break through the initial
line of the flat top of the wedge, then, whooosh, straight through 95^10,
which was the pivotal high of the 3rd February.
\once it broke through there, it was going to be plain sailing - bar a
couple of very bullish retracements up to what turned out to be a pretty
good Double Top. But such was the momentum of the move, it turned out that
the 'reversal', when measured as the market moved back and flattened with a
Doji Sandwich, as I call it, turned out to be a bullish retracement. The
rest, as they say, is the history of my previous post.
I have to say that I have never studied Gann, nor know anything about
squaring this or that or projecting fans and lines and so on. I find I can
only rely on what I believe to be the only thing to rely on - price action
and what has actually happened as a result of buying and selling in the
market.
But, I do have to say, that one has to rely on accurate data. If mine was
wrong (which I doubt, from the way the market moved, in accordance with
reasonable expectation) I would have got into the market a little later i.e.
the breakout of the intraday high, according to your chart. In other words
the bar that broke the pivotal high - it would just not have been such a
good fill!!
Bill Eykyn
www.t-bondtrader.com
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