Gann Fans: A Tool for Predicting Price Movement

26 Apr 2023

What Is A Gann Fan?
Gann fans are a popular technical analysis tool used by traders to predict price changes by analyzing the geometric and cyclical nature of the market. The Gann fan tool consists of a series of lines called Gann angles, which are drawn at specific angles based on price-to-time moves.

The tool is different from trendlines because it moves at a uniform rate of speed. While it helps gauge the strength and direction of the trend, it does not always predict the market's exact location. However, an appropriately set-up Gann fan can provide valuable insights into the market's future price movements.

How To Set Up A Gann Fann
To set up a Gann Fan, you first need to identify the main tops and bottoms on a price chart for your chosen time frame. Once you've found these points, select the Gann Fan tool and draw it from the identified earliest bottom to the most recent main top for an uptrend or top to bottom for a downtrend.

To adjust the Gann Fan, you need to set the correct scale ratio. This can vary depending on the market you're trading in, but a common ratio is 1:1. This means that each unit on the vertical axis (price) is equal to each unit on the horizontal axis (time).

Once you've set the scale ratio, you can adjust the Gann Fan by moving the starting point or the angle of the fan. The angle should be set so that it lines up with the trend line connecting the main tops and bottoms.

For more educational content don't forget to give us a boost and a follow!