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Square of 9 - trading to the minute

2020.04.26---Sq-9-chart

The Gann Square of 9 really is an incredible tool.

It has so many applications if one knows how to use it correctly, that it can literally be used as a stand alone trading tool. Unfortunately, most of what you read about the Square of 9 on the internet incorrectly teaches you the appropriate way on how to use it.

I am often asked about how people can learn more about the Square of 9. The reality is however, that to teach it correctly is not something that can be done over an internet blog or in a book. It really is a tool that you need to learn face to face.

Maybe one day I might start a Zoom Video Tutorial on how to use the Square of 9 properly.

Here is a recent application of the Square of 9 on the Australian ASX 200 index that we successfully used to trade a recent low within minutes of it occurring.

The following chart highlihgts how our intra day trading techniques estimated a low in the ASX 200 at around 5100 at an exact time of 10.26 AM (AEST) on the 22 April 2020 (see first chart below).

The actual low came in at 5100.7 at 10.28AM. So our forecast was within a point and within 2 minutes of the actual time.

To show this was not a fluke and something we have come up with in hindsight, I'd like to refer you to the second chart.

2020.04.26 Sq 9 i

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The second chart (below) highlights that we saw the low unfolding in real time within minutes of it happening. We had been looking out for an intraday buying opportunity on or around the 22/23 April, and once we identified the 5100 low, we were on to it like a kid in a candy shop.

Thinking this might be useful for a lesson on the Square of 9, we immediately set about setting up some charts. The chart below is time stamped on 22 April at around 11.51 AM, or just over an hour from when the low occurred. You can see we had clearly indicated thew at 10.28AM on the chart below. 

So this isn't something we miraculously came up with hindsight. We prepared it for you in real time.

2020.04.26 Sq 9 ii

click here to view image

Trading the markets on an intraday basis using the Square of 9 is hard work. It takes a lot of study and a even a greater amount of discipline. For those who are interested in exploring the Square of 9, I would start with the following article I published on this website more than four years ago. You can view that article here.

In that article, I talk about how to find "Active Angles" in a particular market. Active Angles will differ from market to market, so it is important to find the Active Angle relevant to the market of your choice. In my article four years ago, I talked about the angle of 225 on the Square of 9 and its application on the S&P 500.

I have continued to follow that angle, as it is often useful in determining support and resistance points for MAJOR turning points in the market.

2020.04.26 Sq 9 iii

click here to view image

In the chart above, I have taken the liberty of updating my own Square of 9 chart that I have set up for the S&P500 index. Notice how each of the 225 angles provide significant points of support and resistance for the S&P500. You can see this all the way from 2353, 2551 (the massive support in 2018 lows), 2757 (how the market oscillated around the price zone for months) and the resistance at 2971.

Finally, you can see that the current ALL MARKET HIGH on the S&P500 sits within a fraction of the 3423 angle on the S&P. Even more interestingly is that the recent COVID-19 low basically tested another Square of 9 angle at 2163.

The trick to using these Active Angles in your analysis is to use them as reference points (or markers), rather than looking for them to call the EXACT price level.

I have no doubt these price levels on the Square of 9 will continue to cause turning points in the S&P500 market - so watch them closely.

Until next time...

Stock Market Update (Video)
Is the COVID-19 bear market over?
 

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Tuesday, 26 May 2020

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