David Burton explores the trading methodology of WD Gann: Crude oil is black gold.
Few would think that WD Gann would have coded crude oil cycles in his book, ‘Tunnel Thru The Air’ (TTTA), published on 9 May 1927. It is no surprise to me however, that every oil cycle is indeed coded in TTTA. The cycles in TTTA are taken from the Bible, as Gann stated many times.
First, let’s look at the harmonic cycles of oil, which means looking at thirds, fourths, fifths and their sub-cycles. All WD Gann’s time and price cycles are divided into these parts of a circle. The 360-degree circle chart has been discussed in previous issues of YTE.
Figure 1: Crude oil natal chart
The harmonics of a circle become a new cycle. (In Vedic astrology, Hindu cycles are as small as half a degree or 1/720 of a circle.) Time according to the Bible is: time, times and half time, which is 360, 360, 360 plus 180 – which equals 1260 degrees. When we break 1260 into quarters, eighths, sixteenths and so on we come to the codes in TTTA. Dividing 1260 degrees by four gives 315 degrees; Gann’s 7/8 or 15 degrees Aquarius or 4 February on his square of 9 or 360-degree chart. Most people do not move beyond Gann’s annual cycle, which they call seasonal dates – this is ‘Gann 101’ of cycles, or the 360-degree daily chart.
Everything Gann wrote was very simple for people to understand, providing stepping-stones to greater knowledge. He knew, as I do, that people would simplify his works to market them, so they could be sold en masse. In my view, the mass-sold methods of Gann are not what Gann was doing. Gann’s higher knowledge is for the elite (people who are willing to work for it) and not for the masses. The masses are too lazy, and generally want a quick fix to their life, like winning Lotto, but there is no such thing as Gann made easy!
When we divide 1260 by 16 (the number of planes on the cover of TTTA) we get 78.75. Three-quarters of the way down page 78 Gann writes: ‘It is not my aim to explain the cause of cycles. The general public is not ready for it and probably wouldn’t understand or believe it if I explained it. In every law of nature there is a major and a minor; a positive, a negative, and a neutral. Therefore, in cycles there must be a lesser, a greater and intermediate cycle, or cycles with cycles.’
As it says in Ezekiel: ‘Wheels within wheels.’
Neptune is mentioned in TTTA twice, on pages 178 and 248, a difference of 70 pages. The number 70 or 7 is the most-used number in the Bible.
The crude oil cycle?
Neptune rules oil. Neptune also rules inflation and illusions. Because inflation comes from printing money, money is an illusion. Neptune takes about 164 years to complete its orbit. If we divide Neptune’s time of orbit by 12 (the number of signs in the zodiac) we get an average of a little less than 14 years. If we divide it by five we get about 33 years (the life-span of Jesus Christ). The stock market ran up for 33 years from 1896 to 1929, and from 1974 to 2007. The words ‘Demon of death’ are in TTTA 33 times. The 33rd hour of the planetary hours is the Sun of daylight hours. The word ‘hours’ is on page 7 first and is written in the book 24 times – 24 is the number of hours in a day. Most people know that there are seven planetary hours, equivalent to the seven days of the week, starting from sunrise each day. ‘Seven’ is in the book 34 times. ‘Sunrise’ is in the book three times and ‘sunset’ four times making a total of seven.
If we break Neptune’s time of orbit into thirds we get 55 years. The number 1896 plus 55 plus 55 gives us 2006 – the top of the housing bubble, and, one year later, the top in the stock market. Neptune means inflation when it is in the fire signs, Aries, Leo and Sagittarius: Neptune was in Leo from 1914 to 1929, in Sagittarius from 1970 to 1984 and will be in Aries from 2025 to 2038. Inflation occurred in 1914 when the Germans started to print money and the Deutschmark collapsed. On 9 May 1927, Neptune was at 24 degrees 11 minutes Leo. Twenty-four degrees Leo is 144 degrees (a square of 144 overlay fits the cover of TTTA). Sixty-six years is 144 degrees and the number of books in the Bible. Jupiter was trine Uranus at 23 degrees Leo at the bottom of the stock market in 1932.
Neptune was 180 degrees to 24 degrees Leo in May 2008 – the all-time stock market high was in July 2008. If fact, most commodities topped in March 2008, so May was a midpoint between these two dates. When Neptune went into Capricorn in 1984, deflation started and remained until 1998. Inflation picked up after that, when cheap money fueled the housing boom and commodities until 2006.
If we take the birth chart from the last time Neptune was at 15 degrees Aquarius (315 as mentioned earlier) it shows some great turns in the markets. Oil bottoms seasonally in Aquarius (February) each year. The stock market bottomed when Jupiter was conjunct this point on 12 March 2009.
Once you have made these 20 or 30 charts for parts of a circle, you should produce one for when Neptune goes into Pisces. Neptune in Pisces (Pisces is ruled by Jupiter) will be very destructive. This relates to deception (printing of more money), inflation, prisons, hospitals, the fishing industry and so on. The world’s health system may collapse as it runs out of funding.
The three-week swing chart
Gann swing charts are covers up for parts of a circle. Three weeks is 23 days, or 1/16 of a circle of 365.25 days. This is 22.5 degrees of a circle or half Gann’s 45-degree angle of death. Moving to 315 degrees (4 February) plus 45 equals 360. This last 45- degree angle is where the winter snow starts to melt and we head towards spring on 21 March each year, or the zero point. Forty-five times seven equals 315. Mid-winter is the previous 45-degree angle, starting on 21 December in the northern hemisphere, or 270 degrees, or 3/4 of a circle. Crude oil has seasonal tops in the winter period. (Humans, they always buy at the wrong time! We should have a swimming pool built in the winter, just as a squirrel saves nuts for the winter, but not us humans!) If you can add this tool to the swing chart you will be able to go with the trend.
The turtle system basically copies Gann’s three-week swing chart. Just about everyone in the market is doing some part of Gann but they don’t acknowledge it. Commodities are the new currency and a hedge against the collapsing USD.
You can use the three-week swing chart to trade oil. Look at February’s low as the stop and reverse point with your swing chart. On the Gann swing chart, oil would need to close above $94 a barrel, which is above Gann’s 50 per cent level. In conjunction with the swing chart, you can make a trade with no more than a three per cent stop below the swing if you are long, and a three per cent stop above the swing if you go short. The current stop would be three per cent below $83 at $81.50 – see figure 2.
Figure 2: The three-week swing chart
AFSL No: 241371
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