Gann Square Of 9 : W. D. Gann ( With HDFC stock application)

 

The Gann Square of 9 is a tool used in technical analysis that is based on the concepts of geometric progression and price and time symmetry. The tool is named after William Delbert Gann, a legendary trader and author of several books on trading and market analysis. The Gann Square of 9 is designed to help traders identify key price levels and support and resistance areas in the market, and it can be applied to any financial instrument, including stocks, commodities, and currencies. 

The Gann Square of 9 consists of a grid of numbers arranged in a spiral pattern, with the number 1 at the center and the remaining numbers spiraling outwards in a clockwise direction. Each square in the grid represents a price level, and the values increase in a geometric progression as you move outwards from the center. The grid is divided into four quadrants, each containing 90 price levels. The numbers in the grid are arranged such that the square of any number in the grid is equal to the price level represented by that square. 

To use the Gann Square of 9, a trader needs to identify a starting point on the grid, which is usually the current price level of the financial instrument being analyzed. The trader then moves in a spiral pattern around the grid, in the direction of the price movement, identifying key price levels and support and resistance areas as they go.

 For example, let's consider the case of HDFC Bank stock. Suppose that the current price of HDFC Bank stock is Rs. 1400. To use the Gann Square of 9 to analyze this stock, a trader would start at the center of the grid and move outwards in a clockwise direction. They would first identify the price level that corresponds to the starting point, which in this case is 1400. They would then move to the next square on the grid, which represents a price level of 1476. The trader would then continue moving in a spiral pattern, identifying key price levels and support and resistance areas as they go. 

One common strategy for using the Gann Square of 9 is to look for price levels that are located at significant angles on the grid. Gann believed that these angles, which are based on the principles of sacred geometry, have important significance in the market and can be used to identify key support and resistance levels. The most significant angles on the Gann Square of 9 are 0, 45, 90, 135, 180, 225, 270, 315, and 360 degrees. 

For example, a trader using the Gann Square of 9 to analyze HDFC Bank stock might identify the price level of 1512 as a significant resistance level, as it is located at a 45-degree angle on the grid. Similarly, the trader might identify the price level of 1332 as a significant support level, as it is located at a 315-degree angle on the grid. 

Another common strategy for using the Gann Square of 9 is to look for price levels that are located at the intersections of diagonal lines on the grid. These intersections represent key support and resistance levels and can be used to identify potential entry and exit points for trades. 

To conclude, the Gann Square of 9 is a powerful tool for technical analysis that can help traders identify key price levels and support and resistance areas in the market. By applying this tool to HDFC Bank stock, traders can use it to identify potential entry and exit points for trades, and to develop a deeper understanding of the stock's price movements. However, as with any trading strategy, it is important to use the Gann Square of 9 in conjunction with other tools and techniques, and to always apply sound risk management principles to any trades made using this method.