Squaring a Range of Price

For this post I'll show how to create a Gann Square using the stock Gann fan. This time the method used will be squaring the range. The chart will be a EURUSD 15 min. chart with the start and time being 8/22 3:15 GMT. The range to be squared is the most recent swing from high to low up to that point which covered 69 pips. The average daily range for the EURUSD pair is around 100 pips. So the square will be based on 69 x 2 or 138 to hopefully contain upcoming price movement within the square. Also, recall from the Gann Grid post that price moved in ranges of about 135 degrees or pips so 138 should be near spot on.

First, square the chart by setting the scale fix One to One in the chart properties. Mark off the bottom of the range with a verticle line at the bottom of the swing and horizontal lines on the bottom, top, and then an equal amount of the range higher. Mark off 69 bars and 138 bars in the future with vertical lines.

Next, add the Gann Fan tool to the bottom corner going forward. set the ratio to 1. Being a squared chart, a ratio set to 1 creates a perfect 1x1 or 45°. Add another Gann Fan to the top the upper corner going forward. Set the ratio to -1 to have the fan going downards. Because of the future chart scaling, the 1x1 angles of the fans might not hit the future corners perfectly. That's ok because as Metatrader adavances, the scaling becomes correct. It's a stupid bug, really.

Now mark off the intersections of the fans with vertical lines. Price usually reacts at those intersections. Sometimes just for a bar, other times it's a significant prce change of direction.

As you can see, price completed the square in both price and trime. The intersection lines provided a few clues to when price might react in time. In a future post, I'll go over squaring a range of time.