Hi Reg Gann'ist in training - no more. Gann would buy a stock when it broke an old high. The older the high the stronger it is, therefore a old high broken becomes a new (strong) support line. Gann spent many years looking at historical charts especially wheat and cotton and theorised that all support/resistance marks were "points of mathematical purity" - points at which time and price were in balance. Gann would also buy/sell the stock as it broke a strong resistance/ support line based on ranges. The Gann range markers are: 12.5%; 33.33%; 50%; 66.66%; 100% etc of previous high and lows. Using EVG as an example: I think the low for EVG was around 2.7 or 3 cents so roughly: We would expect resistance support around the 12 to 12.5 mark. This is calculated as high - low divided by 2 (50% marker - one of the stronger) = 22-3 = 19 (the range) divided by 2 = 9.5. Add this to the low of 3 cents. So Gann would have been a buyer at a solid break above 12.5 cents. If you look at the chart there is indeed a battle that went on around this mark. In a nutshell a strong break above 22/23 has no old highs stopping it; but rather it will be the range markers. Sorry about the gobbly gook but in a nutshell after 23 the story for EVG shareholders will get really exciting.
EVG Price at posting:
20.5¢ Sentiment: Hold Disclosure: Held
