Trader’s World Articles
By Eric Penicka
For:
Gann Science: The Periodic Table & The Law of Vibration
Trader’s World Fall 2017
A Method for Constant Success in the Market
By Eric Penicka
In the new book, GANN SCIENCE: The Periodic Table & The Law of Vibration, the Ticker interview with W.D. Gann is broken down and explained, and a trading solution based upon Gann’s Law of Vibration is derived using the clues given in that famous interview.
Though that methodology is the primary purpose and method of the book, other science and math concepts are explored in Gann Science that traders can use to find further tradeable mathematical points of force in the market. These and other techniques presented in the book are still pretty powerful tools and can stand on their own legs as viable trading tools, even though considered secondary to the primary Law of Vibration technique taught in the book.
One of these ideas is the use of mathematical constants in trading. These constants have great predictive value in their own right. Numerous scientific formulae and mathematical constants will work in the analysis of stocks and commodities. By using them as multipliers, or factors, traders can determine additional pressure points in the market.
These pressure points are what were referred to as “mathematical points of force” in the Faraday quote Gann often refers to. These numbers can be used to multiply measurements in price or time, including highs, lows, ranges, or vectors.
There is a chapter in Gann Science dedicated to proving out these numbers with examples of varied market applications. Numerous constants are used in those examples.
In this article, we will test only one mathematical constant, pi, to see how it may help with our trading. Pi is significant because of its connection to the circle and the octave. In the examples following, we will be using pi as a multiplier (factor) to price and time measurements.
In essence, the measurement of price or time would be the diameter of a circle, and when multiplied by pi, the resultant number is the circumference of that circle. This is basically, circling the square, where the swing vector (diameter), would be the diagonal of the square.
This can also work in reverse, where the measurement may be divided by pi and used to take a circumference to find a diameter.
A series of tests will be made on the following charts of the stock of Tesla, (TSLA), the electric car company. This is a good trading stock because of its volatility and presents good options trading possibilities for short to intermediate term swing traders.
Pi as a Time Factor
The first test will be to measure some swing points, getting a bar count between highs and lows, and then measuring that count by pi and projecting it forward.
It is August 21, 2018 as this article is being written and there is a trade triggered yesterday by two pi time count projections coming together which is causing an up move in TSLA stock. There is both an expansion and a contraction projection.
The low came in after the open on Monday 8-20-18. The projection of 23 days between two highs projected 72-bars to the low. The contracting (division) projection took a 49-bar count between two lows to project a 15-bar count to the low. This can be seen at the far right of the chart.
The measuring counts are marked with the gray bar counter, and the projections are done with a black bar counter. All measurements are multiplied by pi, other than the one mentioned prior.
A dozen projections are made on this example chart. Ten of them caused reversals in the market’s price action. Although the projections made were high to high and low to low, there is no rule that says this is the only way this can be used.
There is a key point to mention having to do with the area where the red square is placed on the chart. The area marked is where the 82 and 188 counts come together. There was no reversal at this point which is what is normally expected. When this happens, generally, the continuation move will double the range of the swing in progress to that point.
In other words, the measurement indicates the approximate midpoint of a swing. This is a good place to move into a stop and reverse mode, had a short been put into place. Reverse it into a long, and let it run to the expected target area.
In this example trading bars are used. Calendar days can be used as well and in general are preferable. Trading bars were used to show they work as well.
Pi as a Price Factor
On the next chart, some price range projections will be added in to see how pi may affect price.
Four price projections will be made. 3 of them from small price ranges, and one from just the range of the high bar itself. This one is marked in text at the September 2017 high.
Each range is multiplied by pi, and then projected from the beginning and end of the swing range, or bar range. Notice how these levels act as important support and resistance points and also many gaps take place at these areas.
The last projection off the June high minor range gave the area of the last two swing lows, confirming the two timing signals mentioned in the prior chart, triggering the 8-20-18 long trade.
It should be stated that these points were chosen randomly and are not to be construed as the only valid points to be used. Any other swing ranges not shown in the examples are also applicable and will give different points of force.
It should also be noted that there are multiple points on a chart that when found will tie the various numbers together and act as the best support and resistance areas in price and in time due to their harmonic connection.
Pi as a Slope to Set Gann Fans
The following chart brings into the analysis the popular “Gann fan” concept. Most traders are trying to calculate a 45 degree angle but that is not the true method of finding a correct slope.
A 1:1 relationship is also not a necessary way to begin. Squaring of time and price can be done in a lot of different ways.
One method is to use pi as the slope. On the following chart, two fans are plotted using a slope of .314. Floating the decimal is necessary to fit the fan to the price level of the chart in question.
No prices or high or low are used. Only the slope is input of .314. These can be anchored at any pivot and will give results.
The fans are shown on a separate chart for clarity. The confluent points between the price and time counts along with the fans gives many good trade opportunities. Notice the 8-20-18 low is confirmed by the fan line. Fan lines not involved in the price action were removed.
This is one good use, but maybe not the best construct for these fans. A full chapter dedicated to the proper set up and use of Gann fans is included in the Gann Science book, in the Chapter on Pitch: The Fourth Dimension.
This particular analysis of Tesla has been done using nothing but pi as a multiplier or factor.
This simple mechanism using pi could be developed into a trading system by itself. The nice thing about it is that it only uses simple arithmetic and can be done with a calculator in a few minutes.
Using Pi as a Setting on Technical Indicators
Traders who use indicators can use derivatives of pi to set up their indicators with.
On the following chart, two AMA, adaptive moving averages set at 31 and 314 have been plotted. Two oscillators, a CCI, and a cyclic RSI have been set at 31 length.
Lastly, another fan set from the first top of the double top not used as a fan anchor on the prior chart does a nice job of displaying the vibrational tendencies of the price action. Looking at both of the down fans from the two charts, different angles from the two fans caught some of the same pivot points.
The slope is again .314.
The trend lines on the cyclic RSI are indicating divergence points.
For readers interested in furthering these concepts, try using the prices of highs and lows and multiplying and dividing by pi and its increments to find important support and resistance levels.
The Pi number can be used as a measuring stick by itself. Checking back off the 8-20 low, 315 trading and calendar days hit swing lows. The inclined reader may wish to test planetary longitude. Using Mercury, and measuring back 315* geocentric degrees ties back to a high 11-17-17. These points are shown on the indicator chart. These are good confirmations of the pi projection measurements from the first chart.
These techniques can be used in any time frame. The best trades on a daily bar are set up by numbers coming together on a weekly chart. The entry on the daily bar can be fine tuned by some calculations made on an intraday chart. The best use of this material is to know the position of the market in these various time frames which will lead to very precise trading setups.
Trader’s World Summer 2017
Gann Science – The Periodic Table & the Law of Vibration
By Eric Penicka
Many of you, as I, have been down a very similar path in our efforts to understand the secrets of the legendary trader W.D. Gann, and the other masters from the past.
What is learned is earned through the school of personal research and testing. Knowledge is developed over years of study, reading both exoteric and esoteric material, and trying to meld the two into an understanding of what Gann and the
masters may have been doing, and where they got it from.
This path of research has been a pursuit of mine for over 30 years. On and off over that period, dead ends and roadblocks too numerous to mention lay along that path. Insights are gleaned gradually, and small steps forward are made with the occasional epiphany helping to keep the mind focused, therefore motivating oneself to continue to try to move forward to finding and understanding more of this arcane wisdom.
As researchers into the ideas of Gann, I know many of you have developed an interest in this study that goes far beyond trading. The deeper one explores, the more the secrets are revealed, and the less important the market becomes, as you realize you have come into contact with something far bigger, and far greater, than what you were originally looking for.
In my personal experience, whatever revelations, for lack of a better word, that I have had, have not come from within, but have come from the source of all, the creative intelligence of the universe, or call it God. No matter what religion, or spiritual process one uses, the source of all knowledge comes from the creator. If I had not realized this, I could have never put this work together.
In the introduction to my new book, Gann Science, I have two quotes. One from Paracelsus, and one from Jesus in the New Testament, which strike me as something all Gann researchers will appreciate as the essence of our work:
“Ask and it will be given to you; seek and you will find; knock and the door will be opened to you. For everyone who asks receives; the one who seeks finds; and to the one who knocks, the door will be opened.”
– Matthew 7:7-8 New International Version (NIV)
My writing is the culmination of many years and many 1000’s of hours of research and testing. Anyone understanding natural law, understands that man does not have any original idea's. Ideas, discoveries, and understanding only come from the God source, the life energy force of the universe. We are all one small slice of the same thing.
Great minds of science or any other field were receivers of the ideas and concepts because they had developed the ability to connect to the Source of creative power either consciously, or subconsciously, for it to be given to them.
"All knowledge comes from the stars (the universal mind). Men do not invent or create ideas: the ideas exist and men are able to grasp them."
– Paracelsus
After much reading, research and contemplation, I have decided to release to the public my interpretation of W.D. Gann's famously quoted "Law of Vibration". Gann Science is based on what W. D. Gann said in The Ticker and Investment Digest interview with Richard Wycoff in 1909. Gann researchers have been trying to sort out the market secret of the Law of Vibration since that famous Ticker Interview in 1909.
The time elapsed since The Ticker is approaching 110 years, yet world remains without a clear solution available anywhere in the public domain. This cycle of Mammoth Building proportion may now be at an end…
It is the author’s belief that this mystery known as Gann’s Law of Vibration, as discussed in that original Ticker Interview is now solved in the publication Gann Science just released by the Sacred Science Institute.
Gann really only speaks in depth on the Law of Vibration, hereafter referred to as the LOV, in The Ticker and Investment Digest interview in 1909, and in his interview with The Morning Telegraph in 1922.
In those two interviews he gives readers a basic description of what the LOV is about, and these clues can be used to try to work out the solution. He made other interesting statements along the way which are helpful to narrow things down. Some of these quotes are as follows:
From the Ticker Interview:
“If we wish to avert failure in speculation we must deal with causes. Everything in existence is based on exact proportion and perfect relationship. There is no chance in nature, because mathematical principles of the highest order lie at the foundation of all things. Faraday said, “There is nothing in the universe but mathematical points of force.”
“Vibration is fundamental: nothing is exempt from this law. It is universal, therefore applicable to every class of phenomena on the globe.”
“Through the law of vibration every stock in the market moves in its own distinctive sphere of activities, as to intensity, volume and direction; all the essential qualities of its evolution are characterized in its own rate of vibration. Stocks, like atoms, are really centers of energy; therefore, they are controlled mathematically. Stocks create their own field of action and power: power to attract and repel, which principle explains why certain stocks at times lead the market and ‘turn dead’ at other times. Thus, to speculate scientifically it is absolutely necessary to follow natural law.”
“After years of patient study, I have proven to my entire satisfaction, as well as demonstrated to others, that vibration explains every possible phase and condition of the market.”
“Everything in existence is based on exact proportion and perfect relationship. There is no chance in nature, because mathematical principles of the highest order lie at the foundation of all things.”
And from Gann’s The Tunnel Thru The Air:
“The limit of future predictions based on exact mathematical law is only restricted by lack of knowledge of correct data on past history to work from. My calculations are based on the cycle theory and on mathematical sequences.”
And from The Basis of My Forecasting Method:
“Pythagoras is one of the greatest mathematicians that ever lived."
There are many more quotes available, with which most Gann students are well familiar, but this is enough to indicate that the LOV is clearly mathematical. Mathematical, geometrical, and cyclical. Gann equates mathematical sequences of letter and number, meaning letter converted to number, as a base of analysis.
This next statement is bound to ruffle some feathers, but Gann never equated the LOV to astrology. The LOV is NOT an astrological or astronomical method. This author uses astrology/astronomy as much as anyone else to analyze markets, but it is not a part of the LOV method of Gann, and most particularly NOT the method Gann used in The Ticker.
Astronomical cycles often coincide with the LOV turning points, but those astronomical cycles are not causal. Astrology is a reflection of the root cause of the LOV, but it is NOT the cause itself! This has to do with harmony and resonance between varying components of our universe, and the harmonious proportion of the many ways human beings look to view and interpret natural law.
Gann indicates that vibration is causal and at the foundation of natural law. In order to understand this cause, an in-depth study of the principles of vibration are a prerequisite to even have a chance to understand how this LOV may apply to the markets.
Modern science of today is beginning to respect this line of thinking, after having lost it at the turn of the 1900’s and is finally starting to agree that vibration may be the root cause of natural law and the structural building blocks of our existence.
So, as said, in reviewing Gann's words from The Ticker, it is clear his market application was based on math and science. No hocus pocus, no astrology, just math and science.
In order not to confuse the issue, the simplest thing to do is explore the science that was available to Gann before 1908. This is a sound base that will allow us to know what he may have known. We will also look at science from another angle, post 1909. That may help us with the interpretation of the law from some later sources.
Gann Science is a book about science and the exploration of natural law and its application to the financial markets. The definition of what constitutes natural law may not agree with the definition of natural law we all learned in school. The research done for this work has changed my current understanding of cosmogony in a very big way.
In order to understand what Gann was doing, his words in The Ticker point us to certain areas of study. Those comments bring us to the work of Newlands, Mendeleev, Dobereiner, Gurdjieff, Keely, and Russell. A sound basis of understanding of the theories of these men are necessary to make the corresponding translation to the market.
This work contains a significant summary of the important parts of the science of the periodic table, vibration, and music theory. The summation is necessary to allow a reader unfamiliar with these topics, to have a rounded knowledge base of the science.
This base will then allow us to create and translate that science via the Law of Correspondence into a market application which will allow a trader to trade with a high success rate on entries and exits in the manner that I believe Gann did.
The science involved is very complex and I have tried to the best of my ability to consolidate it to make it as easy as possible to understand. At least, as much as is necessary to have a grounded base as we work into the application.
I will not pretend I am an expert, or a scientist, or say I have all the answers, or understand all the facets of the science Gann understood. I will not pretend that I fully understand the totality of the Law of Vibration. It is a complex phenomenon! In totality, it is fully beyond the grasp of the finite intelligence of the conscious human mind.
Many readers will be seasoned traders, or Gann researchers. Many may be beginners in the field. Hopefully, my summation and presentation will work to the understanding of all, no matter the level of background or experience.
As Mathew quoted Jesus above, "Seek and you shall find, knock and the door will be opened to you."
Nothing truer was ever said, as knocking enough will eventually bring the answer to you. The universal mind of The One is very generous, and will grant that which we ask of It, once we possess the key of knowing how to ask.
Jesus, Gann, and Walter Russell have told us how to ask God for what we want. To open the door, we must learn how to ask, and it shall be given. Learning how to ask, is much more important than anything we can do individually. Our small minds and large egos can get in the way of receiving an important download from the greatest computer in the universe.
The term, Law of Vibration is a term that has many meanings to many different people. The term is confusing as many will associate concepts that were outside of Gann’s words to fall under the large umbrella of LOV.
In this particular work, I have only taken from Gann’s own words to form a hypothesis of what LOV is. My goal when writing Gann Science was to not let anything outside of what Gann said get in the way of the definition of LOV. Anything outside of what Gann said is not under my LOV umbrella.
Since everything is related to everything else, the harmonics between various things like astrology, astronomy, math, science, cycles, even traditional technical analysis like Fibonacci, etc., all will work at some point. People take these correlations or harmonic relationships and place them under the umbrella of LOV. This is what confuses the definition of what LOV really is.
In Gann Science, this scientific system behind the LOV is explored and explained in great detail. The book is broken down into sections with the beginning chapters providing a course in the science of Gann’s time. The scientific background is developed and explained clearly in the early chapters to give the reader the foundation to understand the market application. A full understanding of the science and theory is a necessary prerequisite to applying the information correctly to the market and to recognize the truly important "mathematical points of force".
The next section of the book goes on to explain music theory in detail, as music theory is the simplest way for most of us to understand and relate to the principles of octave theory. It illustrates what the foundation of vibration is, and lays out the basis of the law, along with the key components of the science of Gurdjieff, John Keely, and Walter Russell, which are explored in direct relationship to the market and the LOV. The concept of harmonics and periodicity, what they are and how to use them, all have a concrete application.
There is a chapter devoted to Luo Clements, taking a look at his Ancient Science of Numbers theory. Other chapters look at developing time cycles, composite cycles, and gravity centers are dealt with in a new way, never before touched upon in this manner in a book available to the public. The enneagram, and its associated pressure points and energy flow pattern must also be clearly understood to apply it to the markets.
One of the most amazing things about Gann is that he was a master of what can be termed “translation”. He could take scientific, and mathematical principles, and adapt and relate those ideas to the charts of stocks and commodities.
The latter part develops a theory on what Gann meant by Volume as the 3rd Dimension, and the meaning of his mysterious references to the 4th Dimension. The book culminates with a chapter on how to synthesize the material into a trading application.
Many correlations to The Bible and other books are given, and some of the mysteries that have been pursued in the Gann Internet groups are explained. The Jonah Riddle, the 3 days and 3 nights in the belly of the whale the solution given showing how to use it in the markets. Other concepts that have confounded Gann students such as Daniel’s time, times, and half-a-time will no longer be a mystery.
To give a little more insight into a few of the topics covered, in the chapter on composite cycles, there is a method to make a composite cycle for a stock or commodity without using any price data at all. That may be difficult to grasp, but it is practical and is used to identify trend and direction, and the key points where inversion will take place, if there is going to be an inversion in the cycle.
The way this composite cycle is built gives insight into what the periodicity of the trend really is and how the reader can derive it for any vehicle. Periodicity is the regular recurrence at a stated interval. Those intervals can now be understood and calculated.
In summary, the book Gann Science explains the science of Gann’s time, and where he got it from, with proof, and develops it from theory into a market application.
Two stocks are used as examples and are broken down from the monthly to the daily time frame. The tools in this book can be also taken down to the intraday level as well. The initial analysis begins with the monthly chart and allows the user to find what particular “group” a stock is vibrating with, thereby determining the individual rate of vibration for that stock.
Once the stock or commodity’s rate of vibration has been established, a master number set is created for that vehicle. The master number set is good for all time and is used to predict the price and time points for that vehicle into the future.
The analyses can be done with nothing more than basic arithmetic, and almost any charting platform has enough drawing tools to apply the principles to the chart.
When all is said and done, the reader will be able to take the principles illustrated and make predictions like those Gann provided during the Ticker interview, because the mathematical points of force are known ahead of time and can be traded effectively.
This is a unique way of squaring time and price, and there are certain harmonic points using price alone, where price is enough to make a reversal prediction. However, the best forecasts involve key price points working in tandem with two or more time signatures, which ensures a high probability trend change.
Whatever the preference of the trader, whether swing trading, position trading, or day trading, any time frame can be successfully implemented using the method presented in Gann Science.
The trader can incorporate their present trading plan and analysis tools to use in conjunction with this method. The composite cycle can be used as a trend identification tool and trades can be filtered for trend. Certain points of force are known where counter trend trades can be taken successfully, with a minimum amount of risk.
I believe this work is unique, and that it presents many original ideas that have not been available to the public in any market book today or in the past. The application of the techniques is simple, so simple you will wonder why you didn’t think of some of them yourself. A lot of complexity must be gone through before getting to the point of simplicity as the end result.
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A Solution to Gann's Law of Vibration as Presented in The Ticker Interview
460 Pages
 1st Edition
$3,995.00 (New Hardcover)
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This course offers a solution to the Law of Vibration, as Gann originally presented it in his interview with Richard Wyckoff in The Ticker and Investment Digest, upon his first public appearance in 1909. The author takes Gann's own words and tracks through the science of his day to uncover the meaning of Gann's explanation that 
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