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HISTORY REPEATS

In this lesson we are going to look at the ups and down of market moves. As markets regularly exhibit
pullbacks, it is good to know when a move is likely to come to an end. This will allow you to cash in on
your profits and wait for another favourable pullback to jump on board again.
Gann believed that history repeats. He did more than believe. He made sizeable profits based on his
ability to find repeating cycles. He says in How to Make Profits on Commodities (page 31). Because
history does repeat, the price of Wheat or other Commodities tells the story of the future. Gann traders
initially are sceptical about the repeating cycles in the markets, rightly so. There are simple and easy
techniques that you can employ to investigate and profit from these repeating cycles.
Cycles come in two flavours: price and time. We will cover time cycles on another one of these lessons.
Lets start with price cycles. What you are measuring is the price move from a bottom to a top and then
from that top to the next bottom and so on. If the market always moved the same price it would be so
predictable, markets would not exist. In other words if the market went up $10 then down $5, then up
$10, then down $5... , it would be so predictable the markets would not exist. You are looking at price
moves that look random but have a hidden rhythm. You are looking for price moves that repeat on a
regular basis.
The table below is taken from continuous Wheat chart (three day swing chart). The whole table and chart
goes back to 1959 and we included 2006 onwards to keep the exercise brief. Have a look on where
182.00, 182.00 and 183.00 have repeated. We have highlighted these numbers to make it easy for you.
The price move has repeated exactly as 182.00. In addition, the timing is almost perfect (one year
anniversary) June 2007 and June 2008.
Have a good look at this table and see if you are able to find other repeating ranges.
Hint: Fractions and multiple of certain numbers are worth paying attention to.
Date
Top/Bottom
29/12/2005
Top

Price
347.00

Price Move
45.75

18/01/2006

Bottom

321.50

-25.50

9/02/2006

Top

365.00

43.50

14/02/2006

Bottom

342.75

-22.25

28/02/2006

Top

390.50

47.75

28/03/2006

Bottom

338.50

-52.00

23/05/2006

Top

433.00

94.50

16/06/2006

Bottom

358.00

-75.00

21/06/2006

Top

393.50

35.50

26/06/2006

Bottom

379.00

-14.50

11/07/2006

Top

417.00

38.00

26/07/2006

Bottom

380.00

-37.00

3/08/2006

Top

405.50

25.50

14/08/2006

Bottom

369.75

-35.75

5/09/2006

Top

429.00

59.25

15/09/2006

Bottom

387.50

-41.50

17/10/2006

Top

557.00

169.50

23/10/2006

Bottom

499.00

-58.00

25/10/2006

Top

541.00

42.00

14/11/2006

Bottom

470.00

-71.00

27/11/2006

Top

528.00

58.00

13/12/2006

Bottom

478.50

-49.50

26/12/2006

Top

521.50

43.00

10/01/2007

Bottom

447.50

-74.00

26/02/2007

Top

509.00

61.50

2/04/2007

Bottom

412.00

-97.00

26/04/2007

Top

530.00

118.00

22/05/2007

Bottom

468.00

-62.00

29/06/2007

Top

650.00

182.00

3/07/2007

Bottom

574.00

-76.00

26/07/2007

Top

664.00

90.00

1/08/2007

Bottom

620.00

-44.00

28/09/2007

Top

961.75

341.75

16/10/2007

Bottom

810.00

-151.75

23/10/2007

Top

875.00

65.00

5/11/2007

Bottom

770.50

-104.50

7/11/2007

Top

808.00

37.50

14/11/2007

Bottom

744.00

-64.00

17/12/2007

Top

1009.50

265.50

10/01/2008

Bottom

879.00

-130.50

11/02/2008

Top

1153.00

274.00

13/02/2008

Bottom

983.00

-170.00

27/02/2008

Top

1349.50

366.50

11/04/2008

Bottom

885.00

-464.50

17/04/2008

Top

960.00

75.00

1/05/2008

Bottom

777.00

-183.00

8/05/2008

Top

844.00

67.00

15/05/2008

Bottom

749.00

-95.00

20/05/2008

Top

809.50

60.50

29/05/2008

Bottom

731.00

-78.50

18/06/2008

Top

913.00

182.00

23/06/2008

Bottom

843.00

-70.00

27/06/2008

Top

956.00

113.00

5/08/2008

Bottom

749.00

-207.00

21/08/2008

Top

959.50

210.50

24/10/2008

Bottom

503.00

-456.50

4/11/2008

Top

586.00

83.00

21/11/2008

Bottom

497.50

-88.50

28/11/2008

Top

565.00

67.50

5/12/2008

Bottom

471.00

-94.00

6/01/2009

Top

645.00

174.00

4/02/2009

Bottom

539.00

-106.00

9/02/2009

Top

577.00

38.00

3/03/2009

Bottom

499.00

-78.00

23/03/2009

Top

561.00

62.00

30/03/2009

Bottom

501.00

-60.00

6/04/2009

Top

567.00

66.00

20/04/2009

Bottom

502.00

-65.00

13/05/2009

Top

598.00

96.00

18/05/2009

Bottom

573.00

-25.00

1/06/2009

Top

676.00

103.00

30/06/2009

Bottom

498.00

-178.00

We will give you the answers in the next lesson.


What we discussed in this lesson is the repetitive nature of markets from the price perspective. When you
get to notice these repetitions, you can (and will) time your entry and exit based on these repeating cycles.
It is a bit like getting to know someone very well and being able to determine what they will do next.
In closing lets finish with an inspirational quote from the master himself, W.D Gann, from the
introduction of How to Make Profits on Commodities: If I were not thoroughly convinced by actual
experience, that money can be made trading commodity futures, I would not write this book. I have made
a success in the business, and I know that anyone else can make a success, if they follow the rules.
See you at the next lesson...