Saturday, February 1, 2014

Gann line charts

If you see price breaking a previous swing top, then you are in an uptrend in the time frame and level  minor, intermediate, or major that you are trading in. You would continue to trade only in the long direction until you break a previous swing bottom of the same degree. The following chart of USO opens the day with a minor swing bottom. If we were already in an intermediate uptrend, a trader could use that as an opportunity to trade long intraday until a swing bottom is broken. In fact, traders may want to enter or add to longs when a new swing bottom is formed. After the minor swing bottom is broken, a trader should wait for a new intermediate or major swing bottom to form before entering any more long positions, the use of Gann lines on a chart can help in making safer trades. Many traders don't like to use them so its a personal preferance.In Gann trend indicators on a trading chart, a downtrend occurs when price breaks a swing bottom.
Gann line in trading