W.D. Gann firmly believed that one had to work hard to master the key skills required for successful technical analysis and trading. Indeed, in his books and courses he stated that if someone were prepared to work hard, he would reveal all of his discoveries to them.
I have never had any trouble accepting this principle. Indeed, in my early days of studying Gann’s books and courses, I would take every opportunity to read the book or course in question, summarise it, then type my summary. I would often repeat this process with the same book or course several times, ending up with more and more detailed, and progressively better understood, summaries.
This was certainly an excellent approach to learning Gann theory, and I still use the same technique today, however it never gave me the “feel” for how Gann analysed and traded. Indeed, it left gaps in my knowledge in areas where I had not fully understood precisely what Gann was getting at. (If, at this point, you think that I am obviously a bit “thick”, try reading some of the more obscure sections towards the end of the W.D. Gann Commodities Course!)
My knowledge of Gann theory finally took a quantum leap after attending David’s first Number One Trading Plan Seminar in Sydney some years ago. David had advised me to read 45 Years in Wall Street, as he was planning to base the entire seminar on what many argue was Gann’s best book. I did. I not only read it several times, but summarised it carefully and felt very comfortable with it.
At the conclusion of the seminar David asked me what I thought of the seminar, and I recall saying that the seminar was excellent, however I was surprised at how little of it was based on 45 Years in Wall Street. David laughed. He then said “you obviously haven’t found the key to unlocking Gann’s secrets”! Fortunately for me, David went on to reveal the key.
The key to unlocking Gann’s secrets is to understand the theory of what Gann is saying in his books and courses (this is still the first step) but to then work through the trades he describes. I used to get to Gann’s long, boring (to me at the time) sections where he describes trades and skip 20 pages at a time! I was missing the important bits!
Today I tackle these sections in a systematic manner. I plot any data I can on MetaStock, and print as large a calendar-day chart as possible. I then follow each trade in detail, step by step, marking any key points on the chart, and making notes of any concept I had not fully grasped previously. Not only did the size of my summaries increase immediately, but my “feel” for what he was saying improved immensely. Most importantly, I could see how he used to put the various concepts together.
If you are determined to master Gann technique, read pages 33 to 38 of 45 Years in Wall Street, and concentrate closely on what Gann is saying. (Drawing a rough chart of this period certainly helps the comprehension process.) I am confident that as you work through what he says, you will not only understand exactly how you should use the percentage of high and low prices to calculate support and resistance levels, but you will also gain a feel of how Gann integrated time cycles into his analysis and trading.
Finally, do not be perturbed about the possibility that too many people will unlock Gann’s secrets, thus destroying a good thing. The simple fact of life is that few people will ever go to the trouble of doing the work. We live in a “quick fix” world – hard work is not an attractive option for many people.