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# Squaring the Circle of Time and Price

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## Explaining the Gann Wheel.

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Editor's Note: This is a free publishing of Jeff Cooper's Daily Market Report. To receive a 14 day FREE Trial of Jeff's insights twice daily, click here.

And then one day you find ten years have got behind you
No one told you when to run, you missed the starting gun
And you run and you run to catch up with the sun, but it's sinking
Racing around to come up behind you again
-Time (Pink Floyd)

The Gann Wheel, or what is commonly called the Square of 9 Chart, is a calculator - or a device that squares the circle. It's a way of measuring using square root progression and logarithmic progression as opposed to linear progression.

It's called the Square of 9 Chart because it's a number grid that spirals out from the number 1 in the center, with the first "square" ending in 9. The second square ends in 25, the third square ends in 49. So you can see the square-root relationship of these numbers.

Hence, 360 degrees or one full revolution up from 25 is 49. You can arrive at a full price cycle of 360 degrees from any point by taking the base number, finding the square root of that number, adding 2 and square it. For example, if a stock makes a low at 25 and I want to know what a 360 move up projects to, I find the square root of 25 which is 5 and add 2 to it giving 7. Then I square 7 which equals 49.

By adding 1 to the number 5 and squaring it gives a 180 degree move. In other words 6 squared equals 36 and is the corner number opposite 49. By adding ½ to the square root of a level and squaring it will give a 90 degree move. In other words, 5 ½ squared equals 30.25. On the wheel, the corner number up from 25 is 30 to 31.

This number grid is encompassed by a circle representing the days of the year which will show the harmonics between a number and the date of the year, or a square out in time and price which often times represents a turning point.

Let's take another example. The square root of 15 is 3.87. Adding two to the square root of 15 gives 5.87. Square 5.87 and we get 34.49 which rounds off to 34. Now we see that adding two to the square root of a number and squaring that sum is the same thing as a 360 degree rotation up on the Gann Wheel.

In his famous interview with Richard Wyckoff in 1909, Gann attributed market movements to an undefined Law of Vibration. Since Gann said his greatest discovery was made in 1908, it is thought that techniques related to number vibration underlying the Square of 9 dominated his forecasts and strategies.

"...just as the pendulum returns again in its swing, just as the moon returns in its orbit, just as the advancing year over brings the rose of spring, so do the properties of the elements periodically recur as the weight of the atoms rises."
W.D. Gann

The ancients used to keep time by the rotation of the moon which is approximately 28 days. This is related to the Saturn cycle which is 28 years. While we keep time by the sun and the moon on earth, it is thought by some that our solar system keeps time by Saturn, for which the Greek name is Chronos (as in chronology). Note that spring 2008 is 28 years from spring 1980 which was the low preceding the great bull market.

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No positions in stocks mentioned.

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