Ichimoku Kinko Hyo indicator

The Ichimoku Kinko Hyo indicator  which is also a complete trading system in itself. Roughly translated to price equilibrium, the Ichimoku Kinko Hyo indicator represents current price in relation to past price as well as projects future support and resistance levels. The Ichimoku cloud as it is commonly known was developed in the 1960’s by a journalist, Goichi Hosoda.

The Ichomoku Kinko Hyo indicator comprises of the following components.

• Tenken Sen is the mid-point of the past 9 periods or the average high and low of the look back period. It is also referred to as the Conversion line.
• Kijun Sen is the mid-point of the past 26 periods or the average high and low of the look back period. It is referred to as the Base line.
• Senkou Span A is the mid-point of the Tenken and Kijun sen displaced or projected 26 periods in the future
• Senkou Span B is the mid-point of the high and low of prices of the past 52 periods, projected or displaced 26 days in the future
• Chikou Span is the current closing price displaced or shifted 26 periods in the past.

The Ichimoku Indicator brings with it, its own trading rules.

– When price is trading above the cloud and the future cloud is sloping upwards, it indicates an uptrend and similarly when price is trading below the cloud with the future cloud sloping downwards, it signifies the downtrend.

– When the Chikou span is trading above price it signals that prices are bullish and bearish when the Chikou span is trading below price.

– The Tenken and Kijun sen bullish and bearish crossovers are the final confirmation to the trade bias.

– When trading with the Ichimoku indicator, all the criterion must be taken into consideration rather than looking at each of the signals individually.

    Download Ichimoku Kinko Hyo indicator