Time and Price

7/29/2019 Time and Price

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Article: Time and Price

William D. Gann (1878-1955) was a legendary trader who designed several

unique techniques for analyzing price charts. He developed a unique

combination of precise mathematical and geometric principles which are not

easy to grasp. Gann analysts have spent years pouring over old charts andwritings in search of Gann's secret, and there is no end to the number of people

who claim to have discovered Gann's insight and technique that has eluded

everyone else. Perhaps someone has discovered it. I am not in a position to

appraise all the claims because I am not a Gann expert and have not read

Gann's writings.

Don Hall has published a book and developed a system called Pyrapoint which

seems to me to be well founded in Gann principles. The purpose of this article

s to take one idea used in Don's work, and present it from a different approach,

and yet arrive at the same useful conclusion. I hope even Don will find my

article to be an original insight to substantiate the validity of his work.

Gann's geometric angles are trend lines drawn from prominent tops or bottoms

at certain angles. The most important angle is 45 degrees, which means the

ine's slope is one unit of price per unit of time. (Note: Depending of the chart

scale used, the line may or may not appear to be plotted at a 45 degree angle.)

For years, I thought this is what Gann analysts meant by the phrase 'squaringtime and price.' However, Don's Pyrapoint method gave me a new insight,

which is:

Price = Time squared or P = t ^ 2

Let me take this mathematical relationship and develop it in this article. The

above relationship between price and time can be plotted on a chart as shown

n this illustration. The time values of 10, 20, and 30 are marked by the three

arrows.


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For the sake of illustration, let's suppose a prominent top or bottom occurs at a

price of 400. The theory is that this significant point has a mathematical

counterpart. Start a new time curve at this point in time, and it will give us an

expectation for a future top or bottom to occur on this curve. This principle canbe stated as 'When price meets time, a change is imminent.' This 'price meets

time' relationship is shown in the following chart.


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With the prominent top or bottom at P, if price meets the curve at point A it will

do so in 18 bars. The time to A is the square root of the price at A. Price at A

s 324. Square root of 324 is 18.

f price meets the curve at point B, it will do so in 20 bars. The time to B is the

square root of the price at B. Price at B is 400, therefore the time to B is 20

bars.

f price meets the curve at point C, it will do so in 22 bars. This is a very

nteresting concept!

Remember that price and time are related by the formula: P = t ^ 2 or

t = sqrt( P )

Tools: Pyrapoint

The ideas behind the PyraPoint Tool were developed by Don Hall. For morenformation regarding PyraPoint and how to trade the tool, you can order Don'sPyraPoint Book. The book explains all the details, calculations, and givestraining on how to trade with the PyraPoint tool.The PyraPoint Tool is a Gann based tool that uses Time and Price. Vertical andHorizontal lines are drawn on a chart. Display a chart in Ensign Windows andclick the Draw Tools button to show the Draw Tools panel. Pyrapoint is selectedby clicking the button with a square box and the capital P.

The cursor will change to a pencil while in the draw mode. Move the cursor toan important High or Low turning point on the chart and then click the leftmouse button. The Horizontal lines represent potential support and resistanceevels. The Vertical lines represent probable turning points based on Time.Diagonal lines are used to intersect the Horizontal and Vertical lines. Themarket will often ''walk' up and down the diagonal lines. Pyrapoint will appearusing an appropriate degree of rotation parameter selected by Ensign'sproprietary artificial intelligence algorithm.


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AdjustingRe-selecting the PyraPoint tool will activate the ability to move it to a differentocation. Click the mouse on the Zero starting point to re-select it. The cursorwill change to a pencil. Drag the mouse from the Zero starting point to a new

ocation and the PyraPoint lines will move. Click the mouse again to completethe draw phase.PropertiesTo view the properties window click the Chart Objects button, select PyraPoint,then click the Properties button to open the Properties window for the tool.


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Normalize > 1000 - Place a check mark in the 'Normalize > 1000' box toprevent the Pyrapoint from automatically adjusting the horizontal width ofthe PyraPoint squares when a market is at or near 1000 in price.

Normalize < 100 - Place a check mark in the 'Normalize < 100' box tonormalize the study on 2 digits.

Price - The 'Price' box shows the exact price where the Pyrapoint isanchored. The Price can be edited if necessary.

Degrees - Click the Up and Down selection arrows to change the Degreessetting. The Degrees setting will effect the number of lines that are drawnon the Pyrapoint tool and how closely they are spaced apart. When thePyrapoint tool is in a selected state, you can also click the light-blue Up(Previous) and Down (Next) arrows on the Controls Toolbar. This will alsochange the Degrees setting.

Click the up or down spinner arrow to double or halve the Degree of Rotationparameter. 45 degrees is shown in the example. Clicking the up arrow willchange it to 90 degrees. Clicking the down arrow will change it to 22.5degrees. Also, you can enter any degree in the edit box. Entering a valuegreater than or equal to 1 will be treated as degrees. Any value between 0 and1 will be treated as a percent of 180 degrees. A value of 0.5 is the same as 90degrees. After selecting your preferred colors, Line Thickness and Line Style,check the Use as Default box to save the parameters as the default.To fully understand Pyrapoint, its mathematics, implementation, design, useand how to trade with Pyrapoint, you need to buy Don Hall's Pyrapoint Book orPyrapoint CD. The Book is a professionally published 234-page hard cover

book.Now I would not bother to give you the mathematics in these other articles if Idid not find application of this theory in the charts.

Time and Price Trend Line Slope
http://ensign.editme.com/t13timehttp://ensign.editme.com/t13trendhttp://ensign.editme.com/t13timehttp://ensign.editme.com/t13trend


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Square Root Theory used the mathematics given in the first two articles to develop the Pyrapointdraw tool which draws horizontal lines at calculated price levels, and nearlyvertical time curves at the calculated time intervals. This forms a grid oftrapezoids like the previous illustration. (Don Hall calls them 'squares'.)Diagonal lines connect the corners of the trapezoids to give support andresistance trend lines.Here is a daily chart of JNPR with the construction started on the highest high.

All price levels, time intervals, and trend lines are constructed mathematicallyfrom two pieces of information: the price $244.50 on the date 10-16-2000.

There is more in this chart than I have space to explain. But, I can point outsome characteristics. The horizontal price lines have a label on the left which isa degree of rotation around a Square of 9. This is covered in the Pyrapointbook, but is beyond the scope of this article. Note that in my example, the timeines are nearly vertical. This is a slight variation from the method ofconstruction in the Pyrapoint book which shows vertical lines. I feel that my

presentation is appropriate because of the theory of the time curve illustrated inmy first article. The time curve forms the left and right sides of the trapezoid,and the price levels form the top and bottom sides.Time: Time is measured by the time curve, which is related to price. Tip: 'Asprice meets time, a change is imminent.' Note the first time line labeled 12 onthe bottom and 16 on the top. If price meets time at the -720 horizontal, then
http://ensign.editme.com/t14squarehttp://ensign.editme.com/t14square


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the time for the change would be the 12th bar from the top. If price meetstime at the -540 horizontal, then the time for the change would be the 13th barfrom the top. At the -360 horizontal, the time change would be in the 14thbar. At the -180 horizontal, the time change would be in the 15th bar. At the0 line, the time measured would be 16 bars. That is why the top of the time lines labeled with a 16, and the bottom of the line is labeled with a 12. Starting at16, for each 180 degree down the time count is reduced by one bar, or forevery 180 degree rise, the time count increases another bar. Note that the

market did experience a change when price met the time curve labeled 12 to16!The price at the 12 to 16 time line was used to obtain a forecast of the 2nd timeine, which is labeled 25 to 31. As the price meets each time curve, a new timecurve is calculated based on the price. Each of the time curves showsexcellent correlation with market change when price met the time line.Prices: The prominent high of $244.50 is the calculation basis for all thehorizontal price levels that are shown. Tip: The market seeks out these priceevels, and you can calculate these prices in advance. Note how the market fell

to the -540 horizontal, rallied to the -180 horizontal, fell to the -900 level, ralliedto the -540 level, fell to the -1080 level, and rallied to the -720 level.Trend Lines: The downward 45 degree trend lines shown in red create a flowchannel, or 'price highway' as Don calls it. The upward 45 degree trend linesshown in green create a price highway going the other direction. The red linesare resistance lines that the market must close above to change direction frombearish to bullish. The green lines are support lines that the market must closebelow to change direction from bullish to bearish. We all have used upwardtrend lines placed underneath action lows to indicate support, and downward

trend lines placed above action highs to indicate resistance. The beauty of thistool is that these diagonal trend lines are computed in advance, and the marketseems to have respect for them. Price flows up and down the channels. Themore you study the example, the more impressed I think you will be with thistool.Intra-day ChartsThe Pyrapoint tool can also be applied to intra-day charts with good success.The size of the price interval used on a daily chart seems to be too big for useon an intra-day chart. No problem. Don points out that there are squares

within a square. All one needs to do is sub-divided the price interval intohalves, fourths, or eighths. The time interval is determined from price and willnot change.One question that I have dealt with is this: If the time interval computes to be11 bars because the price is at 121, which intra-day bar time frame should Iuse? If 1-minute bars are used, then we have a time curve 11 minutes later. If2-minute bars are used, then the time curve would be 22 minutes later. If 5-minute bars are used, then the time curve is plotted 55 minutes later. Now doyou see why I have a question? The selection of the intra-day bar time frame

greatly affects the time interval measured by the next time curve.Here is how I tackled the problem, and the proposed solution. I displayed a 1-minute chart and used a cycle tool to measure in hindsight the cycle rhythmfrom bottoms to bottoms, tops to tops, and/or bottoms to tops. When I found acycle width that seems to fit by catching multiple turning points, I note the


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number of minutes in the cycle. I use this formula to estimate a good intra-daytime frame to use.Intra-day Bar Time Frame = Cycle width in minutes / sqrt( P )Example: On the JNPR 1-minute chart I found a 65 minute cycle when the pricewas around $133. Therefore, bar time = 65 / sqrt( 133 ) = 5.6 minutes perbar. So, using a 6-minute chart, or possibly a 5-minute chart should show agood fit with the Pyrapoint tool. I happened to have been following a 5-minutechart, and I do find excellent correlation. I have used a smaller price interval by

subdividing the 180 degree interval into eighths in this example.

Please study the chart, and observe the flow of prices in the up and down trendchannels. Note how trend changes occur on or near the vertical time curves,and how the market seeks the horizontal price levels. This entire road map iscomputed in advance from the prominent top that occurred on January 12th at

9:35 a.m.Daily Charts thought you would like an update on how JNPR has continued to walk thePyrapoint framework of diagonal trend channels, horizontal support andresistance levels, and turns occurring on vertical lines at the end of squares.


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Our January example was through the end of the 5th square marked by the 62to 59 vertical blue line. I was amazed at how JNPR walked down the reddiagonal lines to turn on the -1800 horizontal (tenth rotation of 180 degrees)and at the end of the 12th square marked by the 119-116 vertical line on April3rd. The actual low day was April 4th. Amazing indeed! (Sorry the closenessof the bar spacing causes the 120 label to overwrite the 116 label which isbelow the low turning point.)

Pyrapoint is a draw tool built into the Ensign Windows program based on thework of Don Hall. Horizontal lines are based on the Gann Square of Ninedegrees of rotation from an important swing top or bottom. The Vertical linesare based on the Gann principle of squaring time and price. The diagonal linesntersect the corners of the squares formed by the horizontal and vertical lines.Don Hall's Pyrapoint is a draw tool in Ensign Windows. This plots Gann's Squareof 9. The starting point was the market high. Everything else is projected intothe future without manipulation. The blue horizontal lines are major support /resistance for 45 degree squares from the high. The vertical lines are timeperiods. Notice that the major turning points occur near these cyan verticalines.


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360 degrees of the Square of 9 is the bottom of the market on 03-22-2001, at aone year cycle from the market high on 03-24-2000.On 05-22-2001 we hit the 180 degree Square of 9 from the market high on 03-

24-2000. The turning point also occurred at an exact vertical time point. Thisgave a very strong sell signal along with others.Phi = 1.618. 05-22-2001 is 424 calendar days from 03-24-2000 all-time S&P500 high. Phi cubed times 100 = 424. 05-22-2001 is 263 calendar days from09-01-2000 the S&P double top. Phi squared times 100 = 262. 05-22-2001 is61 calendar days from 03-22-2001 low. 1 / Phi = 61.8Helio cycles: Synodic: JU 15 from 11-06-2000 S&P high. JS 15 from 07-31-2000 low.Sidereal: Mars 120 from 09-04-2000 Labor Day. 240 from 01-17-2000 holiday

(01-14-2000 Dow high).Geo: Moon-Sun-Saturn conjunction with Mercury-Uranus trine.The helio cycles come from Brad Cowan. The geo marker from Myles Walker.Reference: Someone smarter than I at the GannGhost group.

"I have used many, many software applications over the years and I have neverseen anything nearly as powerful and consistent and as elegant in its simplicityas Pyrapoint. I really thank you for such a wonderful creation." - J. Pell 12-03-2000"I must say, as a former~~~ slave, I REALLY enjoy the simple elegance of the

Ensign product. I also use Pyrapoint, which was my introduction to Ensign, andyou really did a great job with that too." -W. Sheppard 12-19-2000You went waaay beyond! Thank You. Everything quickly changed -and for thebetter- once we decided to switch to eSignal so we could use EnsignWindows. We had also researched Pyrapoint; read the book and purchased the


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Pyrapoint Wheel before we determined we needed to take the plunge. (We'dbeen with --- for the last two years.) We haven't quite got Pyrapoint down yetbut know enough to use it as a guide to help us stay in a trade, or get out. Werecognized the potential of the collective applications: eSignal, Ensign Windows& Pyrapoint. Many thanks!' -E. Newman 10-26-2000"I am very impressed with your work on the Pythagorean Cube (PYRAPOINT)system. Your use of multiple trend lines (and thus squares) make a very neatand professional image -- also we are very impressed with the flexibility and

speed of movement of squares on the individual charts. GOOD WORK!" -- D.Hall 12-31-1999"Since you are now looking in earnest toward the learning curve of Pyrapoint, acouple of things may well assist materially. First, we do have software---and avery satisfactory one, I might add---it is designed by Ensign. It is veryaffordable, and VERY user-friendly. Flexibility includes being able to movesquares to any top or bottom of your choosing for your studies and sync. Thesoftware is compatible with several data providers: DTN, Interactive Brokersand eSignal. Most costs are added to the monthly fees paid to your data

provider, @ $49.95 per month where we are. Support is excellent, and Ensignkeeps their updates for free and often." -D. Hall 11-15-2000"As noted in my earlier e-mail the count, the designation of degrees, the ongoing levels of squares, the handling of the 'rounding'---all would make anyPyrapoint customer 'drool'---your work is FANTASTIC, Howard. I am especiallympressed with the simplification that your programming presents as opposedto the problems of the different sized squares with off-sets. With your ability tomove the overlays (squares) it would not seem to reduce the ability to move tothe 'initial force point' after a subsequent significant violation of a diagonal.

This makes it show even more perfectly---and it would make a dramaticpresentation for any student, in my humble opinion. My appreciation---and mycompliments. It has really came together effectively---with a veryPROFESSIONAL LOOK!!!" -Don Hall 01-16-2001


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read more January 2010 Soybean chart by Don Hall
http://www.ensignsoftware.net/png/JanSoybean.pnghttp://www.ensignsoftware.net/png/JanSoybean.pnghttp://www.ensignsoftware.net/png/JanSoybean.png

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Time and Price