Gann Fan

The Gann Fan indicator was developed by W.D. Gann and consists of eight lines drawn around the trend-line at a certain angle. As a rule, a trend line connects major support and resistance points and is marked as a 1x1 line. Then four additional lines are drawn below this trend-line and another four additional lines are drawn above this trend line. The W.D. Gann theory assumes that these additional lines (as with Fibonacci Arks Lines) are important in identifying breaking (turn) points, when the price trend is inclined to change its direction. The lines in the Gann Fan are draw at the following angles:

1x8 line - 82.50 degree
1x4 line - 75.00 degree
1x3 line - 71.25 degree
1x2 line - 63.75 degree
1x1 line - 45.00 degree (trend line defined by a user)
2x1 line - 26.25 degree
3x1 line - 18.75 degree
4x1 line - 15.00 degree
8x1 line - 07.50 degree

In technical analysis, the Gann Fan is used to anticipate moments of possible reversal. According to his theory, when the price moves close to one of the additional Gann lines, it becomes predisposed to reversing its trend, but if the price passes this line, then the next vulnerable point should be expected near the next line.

Chart 1: NASDAQ 100 chart with Gann Fan Tools

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