Gann Line Forex Trading Strategy
The Gann Line forex trading strategy uses the Gann Line at its core in addition to the Moving Average of Oscillator.
The Gann Line can be drawn by inserting a “Trendline by Angle” or by inserting a “Gann Line” directly when clicked through Insert => Gann => Gann Line as seen on MT4 platforms.
MetaTrader4 Indicators: Gann Line (default setting), OsMA.ex4 (default setting)
Preferred Time Frame(s): 1-Minute, 5-Minutes, 15-Minutes, 30-Minutes, 1-Hour, 4-Hours
Recommended Trading Sessions: All
Currency Pairs: any
Buy Trade Example (Click the image for full size)
Long Entry Rules
Place a buy entry when the following chart pattern are in display:
- Buy when the Gann Line serves as a support level for price bars.
- If the histogram of the Moving Average of Oscillator (OsMA.ex4) is formed above the 0.00 level, it denotes a buy signal.
Stop Loss for Long Entry: Place stop loss at convenient levels in line with a firm money management strategy below the “Initial Point” of the Gann Line.
Exit Strategy/Take Profit for Long Entry
Exit or take profit on position(s) when the following conditions are on display on the activity chart:
- If price curve breaks below the Gann Line, it is a signal that trend is reversing and a trader should consider exiting or taking profits on open position(s).
- If the histogram of the Moving Average of Oscillator collapses into the 0.00, it is a signal that trend is about to reverse, giving clue to the trader for an exit or take profit.
Sell Entry Rules
Place a sell order when the following indicator or chart pattern are in display:
- If price forms below a descending Gann Line it indicates a bear market.
- If the histogram of the OsMA MT4 indicator forms below the 0.00 level, it is also a signal for a bearish trend.
Stop Loss for Sell Entry: Place stop loss at convenient levels in line with a firm money management strategy above the “Initial Point” of the Gann Line.
Exit Strategy/Take Profit for Sell Entry
Exit positions when the following chart or indicator patterns are in display:
- If price curve breaks the Gann Line upward, it is a trigger for an exit or take profit on position(s) entered.
- If the histogram of the OsMA recoils and fades into the 0.00 level, it indicates a possible trend reversal – an exit or take profit is advised.
About The Trading Indicators
The Gann Line is simply a trend line plotted at a 45 degrees angle. It is also known as a “Balance Angle” or “one-to-one”, an indication that one price interval matches to one time interval.
William Delbert Gann, who’s the creator of this tool stated that 45 degree angle superbly validates long term trend line – hence its importance.
The Moving Average of Oscillator (OsMA.ex4) is a technical tool that depicts the momentum of price action.