The Correct Scaling of Charts
Chart scaling is the most overlooked — yet most critical — aspect of Gann analysis. The 1×1 angle represents one unit of price per one unit of time and must align at 45 degrees on the chart. If a chart is scaled incorrectly, all Gann angles derived from it will be meaningless. This is why many traders who attempt Gann analysis report failure.
Identifying Key Reference Points
Before any Gann analysis can begin, the analyst must identify the key reference points from which angles and cycles will be projected. These are significant market highs and lows — all-time highs, all-time lows, major yearly highs and lows, and the most recent swing pivots.
The 50% Point: The Most Important Level
In any price range, the halfway point is the most important price level to identify. Gann wrote that the 50% retracement was the most significant support and resistance level in any market. When a market retraces exactly 50% of a prior move and holds, it signals strength.
Bar Charts and the Geometry of Swings
Gann worked with traditional bar charts — open, high, low, close. The geometry of price movement is often cleaner and more readable on bar charts, particularly when analysing swings and the relationship between bars.
A chart is not a picture of the past. It is a geometric record of the market’s vibration through time — and if you know how to read it, it tells you where price must go next.