T P L R: HE Ath of East Esistance
T P L R: HE Ath of East Esistance
BY DANIEL T. FERRERA
COSMOLOGICAL ECONOMICS
THE PATH OF LEAST RESISTANCE
TABLE OF CONTENTS
PUBLISHER’S PREFACE
AUTHOR’S PREFACE
4TH DIMENSION
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PLANETARY ANGLES
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BASE 10 METHOD
PARALLEL ANGLES
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BASE 10 SUMMARIZED
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SWING INDICATOR
FORMATIONS REVIEW
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SQUARE ROOTS
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MONEY MANAGEMENT
CONCLUSION
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DEDICATION
This work is fondly dedicated to my loving wife, who has always been
by my side through good times and in bad with truly unwavering support
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and belief in all my endeavors. To my two college age sons, whom I love
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to enjoy regularly upon reflection. To my dear friends, Tom, Jeremi, Rob and
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Tim who have always been there for me when needed. To all the great
market masters of the past, who inspired me to look for something more in
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the wiggly lines of market data. To the creator of life, who designed this
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for providing the platform that allowed for the excellent illustrations and
chart examples. Without this resource, much of this course would have been
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PUBLISHER’S PREFACE
For 15 years, Dan Ferrera has established himself as one of the leading
experts and educators in the field of Gann Analysis. And yet after these
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to make new discoveries and to develop deeper and more profound insights
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into Gann’s work. One thing he has discovered from his frequent readings
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techniques only become comprehensible and cohesive when these clues are
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Gann’s core course, which formed the backbone of all of his expensive
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his primary teachings on how to use geometrical angles in the markets, and
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this technique is one of the best known and most applied of all of his ideas.
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intentionally left out a critical key element from this course, without which
angles and the squaring of price by time was only disclosed to particular
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reveal these rules and instructions to anyone!” So this essential key to ALL of
who has not had access to this private information, and who does not know
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how to apply these particular instructions. Many people will be shocked and
angry to learn that if they are not familiar with these secret rules, any
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geometric Gann work that they have ever done, whether it be geometrical
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courses and books. One piece may be found only in a rare stock course, while
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Only those who have studied EVERY piece of Gann’s work and gone
over it again and again, sorting, organizing, studying, and applying these
techniques, ever manage to find the proper, integrated use of these valuable
tools. Dan Ferrera is one of the few people who has dedicated this level of
study and research to Gann’s work, and through his ongoing application of
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these tools for a decade in his yearly Outlook forecasts, he has clarified and
This course, Ferrera’s longest yet, will clarify how all of these tools
work, pulling together the scattered pieces, and reintegrating the private
powerful trading signals, which work as they were intended to work on any
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market and time frame a trader requires. This course will present a crystal
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clear and thorough understanding of the most practical and useful of Gann’s
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appendices include the original source material from which Ferrera draws
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his analysis, so that readers can refer back to Gann’s original presentation.
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most seasoned Gann analyst. It will provide a critical foundation for anyone
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AUTHOR’S PREFACE
most useful trading tools and their many uses. Over his 50 year trading and
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Gann was a prolific writer and published six market related books
beginning in 1923 with The Truth of the Stock Tape, 1927's The Tunnel Thru
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The Air, 1930 Wall Street Stock Selector, 1936 New Stock Trend Detector,
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1937 How to Make Profits Trading in Puts and Calls, 1941 How To Make
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addition, Gann published and released various sets and collections of very
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costing from $1500 to $5000 that sold from the early 1920's to 1950.
turn or reversal" in a price trend with 100% certainty in either price or time.
That said, there are valid Gann methods that do produce time and price
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trend. It can also be said that these functional market applications are only
found within the more expensive private course materials, and none of them
"main trend" as defined by the monthly charts which he advised his students
to maintain. Even though Gann hinted or suggested that price levels for
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against the established trend. This form of trading with the trend is what I
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practical common sense trading advice are found in his published books,
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whereas most of his methods for predicting key price levels or forecasting
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when a change in trend should occur are found in the very expensive private
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management and commons sense rules provided in the lower priced books.
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successful in the various speculative markets. Please note, Gann was a very
understand both the trading method and the management of trading capital
to have long term success. In fact, proper money management is far more
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"In getting my initial trading experience, I have been broke many times, i.e. I
have lost all of my money, but there has never been a time yet when I have lost my
nerve"— W. D. Gann
to push the trading envelope. It is well known that he also enjoyed gambling
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in Cuba, and it is likely that this same bug influenced his trading to some
degree. Most of the available quotes that discuss Gann's trading prowess
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In the back section of Martin Armstrong's 1986 book, The Greatest Bull
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(shown below) that discusses his alleged trading success, which can neither
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In any event, notice that Gann never starts a trading campaign with a
large sum of money. For example, the section below states that Gann started
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trading with $300 and made over $25,000 in profits his first year of active
trading. He then took $973 (not the available $25,000) and made over
$30,0000 in Cotton.
his speculative capital on any single trade, and based from what can be
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ascertained from the available sources, he likely only risked three to five
percent of his capital as an average entry risk. Thus, in order to bankrupt the
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"A small loss or several small losses, can easily be made back with one large
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(A) Gann primarily traded long term trends and utilized swing
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charting methods to add to his positions when the market reacted against
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(B) Gann was a very active swing trader and attempted to time and
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a yearly bar chart of the highest high and lowest low, a monthly chart,
weekly chart, and daily chart. Gann always stated that the yearly chart
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The monthly and weekly charts were used to determine the current
nearly all of Gann's published materials, he clearly explains that the monthly
chart is the most important chart of all in determining the market's main
trend, and he advises his students to always go with the trend or to wait
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weekly chart, followed by the daily chart in the third place position.
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Wyckoff - 1909 ), he consistently taught his followers to wait for big trends
to develop as the most money is made from trading with the main trends.
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Gann said:
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"The main thing to do is to always go with the trend and never buck the trend,
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regardless of how much capital you have. By trading with the main trend, you make
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greater profits. Never guess, let the market tell its own story!"
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"the greatest opportunities for profits occur at the end of the great time cycles
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when advances or declines are very rapid and large profits can be made in a short
period of time."
"you will always make the most money following the main trend and playing
the long swing. You can never make money jumping in and out of the market. The
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tops and bottoms occurred at the termination areas of great bull and bear
markets. Gann also kept and maintained records of how long prior bull and
bear markets lasted from start to finish giving an indication of the time range
was likely to present itself. Gann also counted impulse waves, similar to R.N.
Elliott, to determine when a major trend was nearing exhaustion, and noted
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that:
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"History repeats on Wall Street and what has happened in the past will
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happen again in the future. Stock market campaigns often run in 3 to 4 sections of
waves. If it is a real bull market, then it will run at least 3 sections before a final high
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is reached. Reverse this rule in a Bear market. Watch the action of the market when
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that trading with the main trend, limiting risk, protecting profits, and
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prices where a change in trend (CIT) can occur, it is best to utilize these
methods within the context of the larger trend. If the main trend is up, then
capitalize on the times and/or prices where swing lows are occurring at
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top is projected in either price or time, then either tighten up the stop loss to
protect profits, purchase a put option or sell an out of the money covered
call option to hedge against a counter move in the short term trend, but don't
reverse the position to the short sell side, which would be against the main
trend.
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The inverse would be true if the main trend was down. Gann said:
"you will always make the most money following the main trend and playing
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the long swing. You can make large profits on small risks provided you ALWAYS
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use a STOP LOSS order, and apply all the rules and wait for a definite indication of
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The material in this book will explore Gann’s different techniques and
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tools for trading according to his rules, and is intended to be a very practical
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Successful Speculation.
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Daniel T. Ferrera
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December 6, 2014
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drawn to a proper price scale in order for this overlay pattern to have
Figuring a solar year from the Vernal Equinox, when the Spring
season starts on March 21st with the Sun at 0 Aries, this calculator
provides the 1/8th divisions of the yearly cycle yielding Gann's natural
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rectangular scale of the chart, the blue angles visually look more like
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45 angles (1 x 1) and the yellow lines look like 67.5 angles, or 2 x 1
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related via simple multiples and fractions, the 2 x 1 doubling, and the
was a book about the abacus. This book contained all of the algebra
Fibonacci showed that the Roman numeral system was far inferior to
the decimal place notation that was used by the Arabs and Hindus,
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any two adjacent numbers in the sequence forms the next higher
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"We use geometrical angles to measure space and time periods because
you follow the rules and draw the angles or lines accurately from tops and
discussed earlier.
Starting on the left side of the chart, the 1 x 1 angle was projected
until we reach 360. Note that the Square of Nine comes out at 361. The reason
for this is that it is 19 times 19 and the 1 to begin with and one over 360
represents the beginning and ending points. 361 is a transition point and
begins at the next circle. Should we leave the first space blank or make it “0”,
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then we would come out at 360. Everything in mathematics must prove. You
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can begin at the center and work out, or begin at the outer rim and work in to
the center. Begin at the left and work right to the center or to the outer rim or
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square.
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Beginning with “1” at the center, note how 7, 21, 43, 73, 111, 157, 211,
273 and 343 all fall on a 45° angle. Going the other way, note that 3, 13, 31,
57, 91, 133, 183, 241 and 307 fall on an angle of 45°. Remember there are
always four ways you can travel from a center following an angle of 45°, or
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On this chart, we have only shown the 45, 60, 90, 120, 135, 180, 225,
240, 270, 300, 315, and 360 degree angles. This shows the division of the circle
by 2, 4, and 8, and also shows the one-third point and the two-thirds point.
Being the vital and most important angles, we place them so you can see how
This chart starts with the square of 1 in the center, and moves clockwise
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around with the odd squares coming out on the 45-degree angle. These
numbers are 1, 9, 25, 49, 81, etc. The even squares run in the opposite
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continuing on this angle (16, 36, 64, 100, etc.) This produces a variable in
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time and price of 2. That is 2 points in price, 2 days, 2 weeks, or two months
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in time. This chart proves why prices move so much faster at higher levels,
pattern. Thus, this time period would have been monitored very
bottoms, triple tops and bottoms that was discussed earlier in "Form
Reading." There are many successful traders that wait patiently for
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triple top forming on the descending 1 x 8 angle (blue) was nearing the
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end of the first Price-Square of 452 trading days from the extreme high
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