45 Years in Wall Street
 (1949)

In 1910 at the request of friends I wrote a small booklet entitled "Speculation a profitable Profession." In this book let I gave the rules that helped me to make a success in my personal trading.

January, 1923, I wrote, "Truth of the Stock Tape" to help those who were trying to help themselves in speculation and investment trading. This book was favorably received by the public and many proclaimed it my Masterpiece. The book fulfilled its mission as evidenced by letters from grateful readers. After predicting the great panic in 1929 there was a call for a new book to bring "Truth of the Stock Tape up to date. I answered that call in the early part of 1930 by writing "Wall Street Stock Selector" giving my reader; the benefit of practical experience in which I developed new rules since 1923. In "Wall Street Stock Selector" I predicted the "Investors Panic," and said that it would be the greatest panic the world had ever known. This prediction was fulfilled by the panic which ended in July, 1932, with some stocks declining to the lowest levels they had reached for the past 40 to 50 years.

A great advance followed the 1932 panic and  my rules helped many people to make substantial profits. In 1935 satisfied readers asked me to write a new book. I responded to that call by writing my third book "New Stock Trend Detector" in the latter part of 1935, giving the benefit of my experience and new and practical rules which I had discovered.

Since 1935 many changes have taken place; the market passed through the panic of 1937 which was forecast by me. The decline ended in March, 1928, and a minor Bull Market followed to November 10, 1938.

The second World War started September 1, 1939, and the United States entered the war in December, 1941. After we were in the war a further liquidation in stocks occurred and final lows were reached April 28, 1942, when stocks sold below the low level of ,1938 at the lowest levels since 1932. From the lows in 1942 a prolonged advance followed which continued after the end of the Japanese War in August, 1945.

1946, May 29, stocks sold at the highest level they had reached since 1929. My rules and my forecast called the top of this advance and the sharp decline which followed to October 30, 1946, when final low was reached.

Fourteen years have passed since writing my last book and I have gained more knowledge through actual market operations. The world is upset and confused; investors and traders are puzzled over the business depression and the decline in the stock market. Many have written requesting me to write a new book. With the desire to help others I have written "45 Years in Wall Street" giving the benefit of my experience and my new discoveries to aid others in those difficult times. I am now in my 72nd year; fame would do me no good. I have more income than I can spend for my needs, therefore, my only object in writing this new book is to give to others the most valuable gift possible KNOWLEDGE! If a few find the way to make safer investments my object will have been accomplished and satisfied readers will be my reward.

July 2, 1949  W. D. GANN

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PTR's Book Review 9/1/03:

  I n my opinion, this book is by far the clearest and most unambiguous material written by Mr. Gann's in his long and distinguished career as a master trader and author of many books, trading courses, and magazine articles. While the vast majority of the actual material in the book was not new to me, that is only because I had already read just about everything else Mr. Gann published before buying this classic.  I found it to be an easy read, informative, and enjoyable.

  I would most certainly recommend this book as the best place to start for anyone just being introduced to W.D.Gann, with Truth of the Stock Tape being a logical next step if you are still interested in the theories, methods, and techniques postulated by Mr. Gann over his 50+ year career as a Wall Street speculator.  However, I would also recommend that you take the time to at least scan through PTR's Gann introduction, and especially the graphics. That material should provide anyone a good overall perspective of Mr. Gann and a excellent discription of his key trading tools and methods. Even our Free Gann Introduction descends down into the underlying "dirty details," but also does a good job of skimming the surface of the basic concepts for his most important trading and forecasting methods.

  My copy of 45 Years in Wall Street also contains a section that Mr. Gann publish as a separate booklet in the late nineteen thirties, or early nineteen forties, and which I have seen recently being advertise as a separate book. My book was published in 1956, and it includes The New Stock Trend Detector . I'm not sure that all copies contain this section.

  W hile a large portion of this book is consumed by a long list of historical and statistical data, it also includes many examples of Mr. Gann's keen insight into the art of speculation, and is an excellent source on both the human psychological aspects of trading as well as laying the foundation for his more complex theories which deal with the geometric angles, squares, and circles. Also included in the book, is Mr. Gann's twelve and twenty-four trading rules , that are just as true today as they were nearly a century ago when Mr. Gann learned them first hand on the floor of the world's greatest auction house...Wall Street.

  BY the way,  if  Mr. Gann ever had a so-called "secret" to pass on to those who he considered "worthy," then my candidate for that illustrious distinction is not some yet unknown complex mathematical equation, mysterious  geometric calculator, or new found chart overlay, it's his words of wisdom contained in this next quotation: 

   "Just as detectives learn the habits of a certain gang of criminals from the clues that they leave behind them, so can a Wall Street detective find a clue to what the "powers that be" or master market manipulators intend to do with the stocks.

  The movement of a stock, up or down, is made by human minds who buy or sell it with the intention of closing the deals later at a profit. What one man's mind can devise, another man's mind can figure out, for after all, human nature never changes.

   By studying individual stocks and following the rules for detecting and determining the trend , you will be able to make large amounts of money."

For the P rice-T ime Review
Andrew J. Quiggly
Editor  

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CONTENTS :  45 Years in Wall Street

I. Is It More Difficult to Make Profits Now Than Before 1932?

II. Rules for Trading in Stocks...24 Never Failing Rules.

III. How to Select Independent Movers.
Buying one Stock and Selling Another Short. .

IV. Percentage of High and Low Prices

Market Action Proves the Rules. .
Present Position of Dow Jones 30 Industrial Averages .
Let the Market Tell its own Story.

V. Time Periods of Short Duration Correct Prices.

Liquidation after a Long Decline and a Short Rally in a Bear Market.
Final Liquidation in Great Bear Market
Secondary Decline after September 8 High.
Secondary Rally.
Sharp Corrective Declines .
Final High in the Bull Market.
Secondary Rally in Bear Market. .
Final Liquidation in the Bear Market.
End of Short Bull Market.
Sharp Decline and Clean Out.
War Moves .
Final Lows End of Bear Market
Final Tops End of Bull Market .
Secondary Decline .
After Election, Sharp Quick Declines.

VI. Time Periods for Important Swings on the Averages.

VII. Dow Jones 30 Industrial Averages 3-Day Chart Moves
9-Point Swings Dow Jones 30 Industrial Averages.
30.Point Moves

VIII.Months when Extreme Highs and Lows were Recorded.
Monthly High and Low Prices Each Year.
Dow Jones 30 Industrial Averages Time Swings.

IX. June Lows Comparison for Future Highs.
Anniversary Dates
Important News Events.
Resistance Levels 128-130 .
Resistance Levels 193-196 .
Resistance ce Levels 158-163 .

XVolume of Stock Sales on New York Stock Exchange.

XI. IS Public Utility Averages.
Barron's Air Transport Averages.
Stocks with Small Number of Shares.

XII. Puts, Calls, Rights and Warrants on Stocks.

XIII. New Discoveries and Inventions.
Atomic Power

XIV. Great Market Operators of the. Past.

XV. Stocks Liquidated.

XVI. Can United States Afford Another War? .
The Government Cannot Prevent a Depression.
What Will Cause the Next Depression or Panic? .
Great Panic Coming-Future Trend of Stocks.
Great Panic Coming-Future Trend of Stocks.
Outlook for 1950 .
Preview of 1951-53 .
Conclusion.

ANSWERS TO INQUIRIES.

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EXCERPTS...SELECTED QUOTES       45 Years in Wall Street

The excerpts from the book are not necessarily complete, as I picked out what was some of the more important points that Mr. Gann discussed, in my personal opinion, and only I typed in the sentences and paragraphs that appeared useful to me.  Also, I may have made some mistakes in the transcription, so keep that in mind as well. My goal here is to provide enough information to spark an interest in the book, not to provided enough information that someone doesn't need to purchase it or get it through their county library, or the inter-library loan process. Unlike other Gann books, 45 Years in Wall Street is readily available.

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Why You Should Learn to Determine the Trend of the Market

You may have tried to follow market letters and like many others either lost money or failed to make profits, because the market letters gave a list of too many stocks to buy or sell and you picked the wrong one and lost. A smart man cannot follow another man blindly even though the other man is right, because you cannot have confidence and act on advice when you do not know what it is based on. You will be able to act with confidence and make profits when you can SEE and KNOW for YOURSELF why STOCKS should go UP or DOWN.

PERCENTAGE OF HIGH AND LOW PRICES

One of the greatest discoveries I ever made was how to figure the percentage of high .and low prices on the averages
and individual stocks. The percentages of extreme high and low levels indicate future resistance levels. There is a relation between every low price to some future high prIce. and a percentage of the low price indicates what levels to expect the next high price. At this price you can sellout long stocks and sell short with a limited risk.

The extreme high price or any minor tops are related to future bottoms or low levels. The percentage of the high price tells where to expect low prices in the future and give you resistance levels where you can buy with a limited risk.

The most important resistance level is 5O % of any high or low price. Second in importance is 100% on the lowest selling price on the averages or individual stocks. You must also use 200 %, 300 %, 400 %, 500 %, 600 or or more, depending upon the price and the Time Periods from High and Low. Third in importance is 25 % of the Lowest price the Highest price. Fourth in importance is 121/2 % of the extreme Low or extreme High price. Fifth in importance is 6/4 % of the Highest price, but this is only to be used when the averages or individual stocks are selling at very high levels.
 
Sixth in importance is 33 1/3 and 66 2/3 %. These percentages should be calculated and watched for resistance next after 25% and after 50%. .

Change in Trend in Bull Market

A change in trend often occurs just before or just after holidays. The following dates are important. January 3, May 30, July 4, the early part of September, after Labor Days, October 10 to 14, November 3 to 8 in election years, and
November 25 to 30, Thanksgiving, and December 24 to 28. This latter period may run into the early part of January, before a definite change in trend is indicated.

When prices on the Industrial Averages or the individual stocks break the last low on a 9-Point Swing Chart or break the last low on the swing on a 3-Day Chart it is an indication that the trend has changed.

Bear Market: In a declining market when prices cross the Top of the last upswing on a 9-Point Chart, or cross the top of the last upswing on a 3-Day Chart, it is the First Signal for a Change in Trend. When prices are at High Levels there are usually several swings up and down; then when the market breaks the Low of the Last Swing it indicates a reversal and change in Trend.

At low levels prices often narrow down and remain in a narrow trading range for some Time, then when they Cross the Top of the last upswing it is is important for a Change in Trend.

Always check to see if the market is exactly 1, 2, 3, 4 or 5 years from any extreme High or Low price. Check back to see if the Time Period is 15, 22, 34, 42, 48 or 49 months from any extreme or low price, as these are important time periods to watch for Change in Trend.

TIME PERIODS OF SHORT DURATION CORRECT PRICES

You often hear people say the market needs a correction. Prices have advanced too fast or declined to fast. When this happens in an advancing market it becomes over bought, shorts have covered and the technical position of the market is weakened, therefore, a price correction is in order. This may be a sharp, quick decline in a very short period of time. The fact that the price declines very fast scares people, they lose hope and decide the market is going very much lower, when as a matter of fact a short decline :i short decline in a very short period of time has corrected the tech technical position from a weak position to a strong on one.

The same occurs when the market has been declining for some time and it has built up an over extended short interest and longs have liquidated leavIng the market In a weak technical position. Then a sharp advance takes place on short covering in a very short period of time. This causes buyers to become over confident and buy at the top and decide that the movement is going to continue but the technical position has been weakened and the mark market has been corrected on the short side by this sharp rally. Then the main trend continues on down.

Apply all of the rules at all times in order to prevent misjudging the trend of the market or making mistakes. Remember, when yo au do make a mistake or see that you are wrong, the way to correct it is to get out of the market immediately, or best of all when you make trade, place a Stop Loss Order for the protection of your capital. Keep in mind at all times the greatest TIME PERIOD, or the greatest correction of the market when it is advancing, and when a market is declining keep in mind at all times the greatest TIME PERIOD that had occurred when the market had rallied in a Bear Market. Keeping up with these Time Periods will help you to determine the Trend of the market.

 
TIME PERIODS FOR IMPORTANT SWINGS ON THE AVERAGES

When you have a record of the time required for each important swing of the industrial averages and you know the amount of the advance or decline, you are able to tell something about how long a time period the market will run in the future and you can watch for a change in trend at the end of the important time cycle which has repeated the greatest number of times in the past.

MONTHS WHEN EXTREME HIGHS AND LOWS WERE RECORDED

Because stocks run according to seasonal  changes and make extreme highs in certain months at the end of a Bull campaign, or in a major or minor move, it is important to go over past records when extreme highs are made at the end of these important moves.

NEW STOCK TREND DETECTOR

CONTENTS

I. A New Deal in Wall Street.
I. Foundation for Successful Trading.
III. HIstory Repeats . .
IV. Individual Stocks vs. Averages .
V.  New Rules to Detect Trend of . New Rules to Detect Trend of Stocks. 
VI. Volume of Sales. .
VII. A Practical Trading Method.
VIII. Future Trend of Stocks.

Since writing TRUTH OF THE STOCK TAPE in 1923 and WALL STREET STOCK SELECTOR in 1930, the greatest panic that the world has ever seen has taken place, culminating with the greatest stock decline in history, reaching extreme low levels on July 8, 1932. Conditions have changed since 1929 and new laws have been passed affecting stock market movements. The passing of the law supervising stock exchanges has made a great change in the action of the stock market and made it necessary to formulate new rules to meet the changed. conditions. The Bible says, "Old things pass away and new ones come to take their places." "A wise man changes his mind, a fool never." The man who refuses to change, when conditions change, or to see the new way of doing things is doomed to failure.

I have studied and improved my Methods every year for the past thirty-five years. I am still learning. Some of my greatest discoveries were made between 1932 and 1935. After long years of study and research, I have simplified and made my rules practical so that others can apply them as easily as I can. I have eliminated unnecessary details, have cut down the work so you can get results quicker; and have made profits by following strictly the same rules.

KNOWLEDGE BRINGS SUCCESS

The door that opens to big profits has but one key to unlock it and that key is Knowledge. You cannot get that
knowledge without work. I have made a success by hard
work and you, too, can make plenty of money out of the stock
market if you study and work hard enough. Work is the
way to find the Royal Road to riches in Wall Street.

QUALIFICATIONS FOR SUCCESS

1ST: KNOWLEDGE
2ND: PATIENCE
3RD: NERVE
4TH: GOOD HEALTH
5TH: CAPITAL

HISTORY REPEATS

Future stock market movements can be forecast  by a study of past history and past movements. By  knowing the time when the greatest advances have taken place and the times when the greatest panics and declines have occurred I and the time periods to watch for major and minor changes in trend, you can detect what to expect in the future. Just remember one thing, whatever has happened in the past in the stock market and Wall Street will happen again.

Advances and bull markets will come in the future and panics will come in the future, just as they have in the past. This is the working out of a natural law and the balancing of time wIth price. It is action in one direction and reaction in the opposite direction. In order to make profits, you must learn to follow the trend and change when the trend changes.

It is important to study the time that has elapsed between bottoms and tops and the greatest duration of any bull campaign as well as the greatest duration of any panic or decline.

W. D. GANN
AVERAGES
1856-1874  

12 INDUSTRIAL STOCK AVERAGES
1875-1896

Here we begin with 12 Industrial Stocks ,which were  mostly RAILS and not nearly the same as the Dow Jones Averages, which was first published "to the public" in 1896.

1896-Bryn Silver Panic:

August, 1896, low of the Dow- Jones (12) Averages at 29. Time, 14 months from the top of 1895, and 43 months from the January,1893 top. After this was a panicky decline was over, the McKinley boom started, which lasted for several years.

Dow-JONES INDUSTRIAL AVERAGES [12 stocks]

1897-1935

1897-September, high 55. Time, 12 months

1898-March, low 42. Time, 6 months from the previous top.

1899-April, high 78. Time, 13 months. A sharp decline followed in May; then a slow advance. September, high 78, same as the April high. Time, from 18796, 37 months and from March, 1898, 18 months. 

1900-September, low 53. Time, 12 months. End of bear market.

Going back over all the records, we find that the great est bear market had lasted not more than 43 months and the smallest had been as short as 12 months. Some of them had culminated around 27 months, 30 months, 34 months and in extreme declines, anywhere from 36 to 43 months.

Therefore, from 1929, based on past records, we would begin- to watch for bottom around the 30th to the 36th month and then again around the 40th to 43rd month.

CAUSE OF THE 1929-1932 PANIC

After stocks had declined 100 points or more, other people began to buy stocks, because they thought they were cheap, and the only reason they thought they were cheap was because they were down 100 points compared with high levels. This was the worst reason of all for buying stocks.

Later, when stocks were down around 150, 250 and 300 points from 1929 top levels, other people bought for the same reason, that they were a long distance down from the top and looked cheap. They were wrong because there had been no change in trend. The time period had not run out and the market had not given buying signals.

"WILL STOCKS Go BACK TO 1929 HIGHS?"   [This clear example of Mr. Gann's failed predictions should return some of his most dogmatic supporters to reality]

I am confident that the Dow-Jones 30 Industrial Averages will never sell at 386 again. I am also confident that the Railroad Averages will never sell at 189, the high of 1929, and that many of the public utility stocks will never reach the 1929 levels again. Why? Because at the time they sold at these abnormally high levels, their selling price was not based on value or earning power. Prices were forced to these high levels for the simple reason that everybody was gambling mad and buying regardless of price or value. They will not buy stocks again like that for a long time to come because high margin requirements will restrict larger buying operations.

NEW RULES TO DETECT TREND OF STOCKS

The rules which I give in my books, TRUTH OF THE STOCK TAPE and WALL STREET STOCK SELECTOR, are all good, They will work in future markets for a 100 years but under the changed conditions stocks will move up slower the greater part of the time and on a smaller volume. (Compare present volume of  U. S. Steel and General Motors with volume of former years.). The rules in my books are based upon Supply and Demand; have been tried and tested. Whether stocks advance on buying by the public, pools or investors, it is after all the result of Supply and Demand.

The new rules that I give you in this book, if used with the rules in my other books, will help you you to make a success
trading in individual stocks.

Just as detectives learn the habits of a certain gar gang of criminals from the clues that they leave behind them, so can
a Wall Street detective find a clue to what the "powers that be" or master market manipulators intend to do with the stocks. The movement of a stock, up or down, is made by human minds who buy or sell it with the intention of closing the deals later at a profit. What one man's mind can devise, another mind can figure out, for after all, human nature never changes. By studying individual stocks and following the rules for detecting and determining the trend, you will be able to make large amounts of money. 

KIND OF STOCKS TO TRADE IN

WHERE TO BUY AND SELL PRICE

AT WHICH FAST MOVES START
The higher the price, the faster a stock moves and the wider the fluctuations.

TIME TO HOLD AFTER BUYING OR SELLING

BUYING OUTRIGHT FROM 1929 TO 1932

WATCH BOTTOMS AND TOPS OF PREVIOUS CAMPAIGNS

HOW TO DETECT EARLY LEADERS IN A BEAR MARKET

HOW TO DETECT EARLY LEADERS IN A BULL MARKET

HOW TO DETECT STOCKS IN STRONG POSITION

NEW LOWS LATE IN A BEAR CAMPAIGN

NEW HIGHS FOLLOWING YEAR AFTER END OF BULL CAMPAIGN

STOCKS THAT CROSSED 1929 HIGHS

STOCKS THAT DID NOT ADVANCE MUCH FROM 1932 TO 1935

STOCKS IN WEAK POSITION IN A BULL MARKET

After an extreme low has been reached in a bear market and stocks start to rally, those that rally only 2 to 3 months in the beginning of the next bull campaign and then never cross the top levels of the first rally are in a very weak position.

HOW TO DETECT INDEPENDENT MOVERS

BUYING ONE STOCK AND SELLING ANOTHER SHORT A'I' THE SAME TIME

STOCKS THAT RALLY OR DECLINE ONLY TWO TO THREE MONTHS

SHOULD STOCKS WITH SMALL NUMBER OF SHARES OUTSTANDING BE SOLD SHORT?

WAIT FOR DEFINITE BUYING SIGNAL AT BOTTOM

VOLUME OF SALES

The Volume of Sales is the real driving power behind the market an shows whether Supply or Demand is increasing
or decreasing. Large buying or selling orders from professional traders, the public or any other source of supply and
:demand, are bound to be registered on the tape and shown in the volume of sales.

Therefore, a careful study of the Volume of Sales will enable you to determine very clearly a change in trend, especially if you apply all the other rules for detecting the Position of a stock

RULES FOR DETERMINING CULMINATION'S BY VOLUME OF SALES

Rule I

At the end of any prolonged bull campaign or rapid advance in an individual stock, there is usually a large increase in the volume of sales which marks the end of the campaign, at least temporarily. Then, after a sharp decline on heavy volume of sales, when a secondary rally takes place and the volume of sales decreases, it is an indication that the stock has made final final top and that the main trend will turn down.

Rule 2-

Rule 3-After a prolonged decline of several weeks, several months, or several years, at the time a stock is reaching bottom, the volume of trading should decrease and the range in fluctuation should narrow down. This is one of the sure signs that liquidation
is running its course and that the stock is getting ready to show a.change in trend.

Rule 4-After the first sharp advance (when the trend is changing from a bear market to a bull market) the stock will have a secondary reaction and make bottom, just the same as it had a secondary rally after the first sharp decline. If the volume of sales decreases on the reaction and then the stock moves up, advancing on heavier volume, it will be an indication of an advance to higher levels.

Summary:

Sales increase near the top and decrease near the bottom, except in abnormal markets, like October and November, 1929 when the market was moving down very fast and culminated on large volume of sales, making very fast and culminated on large volume of sales, making a sharp bottom, from which a swift rebound followed. As a rule, after the first sharp rally, there is a secondary decline on decreased volume, as described above under Rule 4.