the hAnDbook oF teChnICAl AnAlySISprice rejections in the markets. We see from Figure 19.32 that there are three sig-
nificant barrier zones, located at or ranging from:■ (^) 33 percent to 38.2 percent
■ (^) 50 percent
■ (^) 61.8 percent to 66 percent
The trader should therefore always be vigilant for a clustering or confluence
of these different retracement levels once identified, as prices may react strongly
at these barrier zones.
the Data Dropout effect
Charting platforms may omit or include non‐trading days, depending on the ser-
vice provider. The addition or removal of such data from the charts will impact
dynamic overlay indicators such as trendlines, channels, and chart patterns, that
is, overlays that depend on the drawing of diagonal lines connecting different
price inflection points. The addition, removal, or unintentional dropout of such
data will affect the angle of trendlines on the charts. As such, Gann fan lines and
grids would be the most affected. Conversely, such data variations will not have
an impact on numerically determined forecasts such as percentage reversal levels
and Square of Nine price projections.
19.4 Chapter Summary
In this chapter, we learned about the importance of balance between price and
time, which forms the basis of most of Gann’s analytical approaches. The prac-
titioner should note that there are many modern variations to Gann’s originalfiGure 19.32 Closely Related Retracement Ratios.