Gann Time and Price- Sugar Futures

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WD. Gann's work extensively involved both Time and Price predictions. From his writings, we can determine that he believed time was the most important factor in determining market movements. Gann wrote, "Mathematical science, which is the only real science that the entire civilized world has agreed upon, furnishes unmistakable proof of history repeating itself and shows that the cycle theory, or harmonic analysis, is the only thing we can rely upon to ascertain the future."

The vertical lines on the chart above display an expanding Gann time cycle. The horizontal green line is the current price support level which is similarly derived from Gann Squares.

On 02/02/2011, Sugar peaked at .3592 usd/lb. From .3592 we get a downside target of .2035.

As .2035 is 1/4 of one degree lower than .3592.

Concerning time, from 02/02/2011, we get a target date cycle of 13/05/2011. May 15th, 2011 is 45 degrees down from Feb 2, 2011. In addition to a 45 degree time cycle, a cycle of a lesser degree also occurs on May 15, 2011. 5/13/2011 is 22.5 degrees down from March 24, 2011. March 24th is indicated by a red vertical line. March 24, 2011 is also 22.5 degrees down from 02/02/2011.

Now we can begin to see how the geometry of time and price is beginning to unfold. The minimum inflection from a properly derived Gann price is a price reversal to another Gann level. It may sound confusing but just think of this minimum movement as corrective behaviour. After this minimum movement, the larger trend often continues unless the initial inflection level is of significant time and price importance.

From the .2035 - 5/13/2011 target, the minimum inflection has resulted in a rally to the minimum upside Gann price of .2203. With the evidence that there are 2 time cycles which mature on 5/13/2011, we can hypothesize that the minimum distance price must travel higher is one larger degree than it already has. Given a break above .2203, price is expected to surge and travel up to atleast .2383 before resistance is met. If this analysis is incorrect, and the .2035 level does not hold as support over the next several days, price can be expected to fall to atleast .1869.