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Gann Trend Oscillator

Gann Trend Oscillator

This lesson will cover the following

  • Definition
  • Interpretation

Developed by Robert Krausz, the Gann Trend Oscillator is a trend-following indicator used to determine the financial instruments long-term price direction.

Just like the Gann Swing Oscillator, the Trend Oscillator displays the transition from an uptrending into a downtrending market and vice versa. The indicators values are again displayed in a scale ranging between +1 and -1.

An uptrend is signified by a value of +1, while a market trending down is defined by the indicator edging down to -1. Here is how the Gann Trend Oscillator is visualized in a trading platform.

Gann Trend Oscillator

Chart source: VT Trader

We said in the previous article that the Gann Swing Oscillator is used to define short-term trends as the market swings, and thus pinpoint accurately market entry points. The Gann Trend Oscillator complements it by determining the long-term market direction.

Entry signals are presented when the Gann Trend and Swing Oscillators converge. Thus, a buy signal is produced when the Trend Oscillator rises from -1 to +1 and matches the Swing oscillators value of +1. Conversely, when the Trend Oscillator declines from + 1 to -1, while its counterpart has already been at -1, it indicates that the major trend has turned bearish and you should limit your trades only to short positions. The Gann HiLo activator pinpoints exact entry points and also determines the stop-loss levels. Here is how the three look combined.

Gann System