How would WD Gann have traded this market? 4 points of the WMOT

WD Gann published "The Tunnel Thru the Air" in 1927 and encoded in it the "Map of Time" and the "wheel within the wheel" "Weekly Map of Time."  We might expect that this device, if it is valid and his greatest timepiece invention, would be his preferred instrument of trading the DJIA (as opposed to, say, his Square of Nine).

Assuming the WMOT is an accurate device, how would he have traded the DJIA on January 11 and 12, 2018?  Would he have made money?

After re reviewing the WMOT, which I have been following haphazardly this last week, have four data points for those two days.  There are only four points marked by "Pi" in the acrostic telestic encoding.  Those four points from the WMOT are (yellow highlight):

1

and 2,

and 3,

and 4,

I've linked a one-minute chart to the 1, 2, 3 and 4 above to show the bar that was predicted and the price at that exact bar.  I'm made notations as to how many minutes the WMOT deviated from the nearest recognizable pivot (One was 5 minutes off which violates the 4 minute complete cycle.  I excuse that as the math from the "correct beginning" is many years and my calculations, though entirely mathematic, could involve some "user error.").

Four data points, those being 12:21pm on January 11, 2018 and 9:49am, 12:20pm and 3:49pm of January 12, 2018.  I followed two of them in real time this last week and those two were perfect (within the smallest cycle of 4 minutes).  But does that mean Mr. Gann would have made money if he traded them?  Let's make some assumptions and see.  The assumptions:

• The first of the four trades is on the correct side of the market. 
• Each successive trade flips.  Each WMOT predicted pivot has WD Gann reversing from short to long and vice versa.
• The entry/exit point of each flip will occur at the average price of the hi and low of that predicted moment.

Here are the four data points in a one-minute chart as an overview.  Note the arrows indicate assumed entry and exit points (green for establishing long and red for covering long and establishing short).

I have attached to the numbers 1, 2, 3 and 4 above, hyperlinks to screen shots of four one-minute charts that give the market prices at each trade.  Here is the derived spreadsheet of WD Gann's trades:

Two wins and one loss according to the yes/no outcomes (coin toss, Bernoulli process).  From a dollar weighted viewpoint, Mr. Gann realized a net 182.29 points from the first three trades (four trades but one remaining open at week end).  A trader that correctly traded that first trade long at 12:21pm on January 11 and held continually for that same period (to 2:39pm on January 12, 2018) made 278.47 points.  Or, a trader that shorted the 12:21pm January 11, 2018 bar and held for the same period lost 278.47 points.  That's realized points for the three alternates.

Unrealized positions would have worked to the detriment of how Mr. Gann would have traded this market.  Mr. Gann's position is short at the close and the market had inclined from his last trade at 2:39pm in which he became short.  The continually long trader had further unrealized gains and the continually short trader had further unrealized losses.  In that case, Mr. Gann net realized gains would be netted down by an unrealized losses of 35.75 (his short position of 25767.44 less the close at 25803.19).  The unrealized losses would reduce Mr. Gann's gains to 146.55 at yesterday's close.

Let's say the continually long trader and continually short trader were "random walk(ers)."  Take their gains and losses and average them.  Nothing was gained, net, because random walk means a trader can't have an edge by any means or methods.  (Of course, I don't believe that, be it WD Gann, Elliott Wave or choice other methods.)

*** ***

Of 314.22 points the market "traveled," net, from 12:21pm on January 11, 2018 to the close January 12, 2018, Mr. Gann's WMOT took 182.29 realized or 146.55 unrealized.  Beats sitting on your hands.

Of course, there's the pesky assumption, above, that he was on the correct side of the market with his first trade.  I can only comment that he said he had strict stop loss rules I expect would have corrected him pretty quickly.  

So, the WMOT "system" is short over the weekend and the perfectly prescient long trader is, well, long.  The next WMOT predicted pivot is 10:30am on Monday the 15th.  Then there are two more (a quick count) of two more pivots before noon on Monday, a total of four for the day!  I'll keep tracking for a while.

As an aside.  If the WMOT is an intended "timepiece" as were other devices in my opinion (Square of 9, etc), I believe it to be his most sophisticated of all and, unlike the others, one that came with encoded instructions on how to operate it.  I don't believe anyone, at least that I've read, has explained the Square of 9 or any other of his sophisticated devices to the extent that they could operate it and achieve anything approaching the 92% success rate  touted in the "Ticker Interview."  Or to have accompanied him, as did the Square of 9, as he walked the NYSE floor, I've read.  Once one device is understood, then perhaps the ancient mathematics or natural laws on which it might be based will become evident.  

Until then, its all as if magic to us that he could have done such things as he did.  

Jim Ross