i chimo ku clouds

7/25/2019 i Chimo Ku Clouds

1/10

LIBRARIES

Planetary2LibraryICHIMOKU CLOUD LIBRARY

Introduction:

In1969,GoichiHosada,ajournalistinTokyo,developedaveryversatileindicatorthathas

withstoodthetestoftime.TheIchimokuCloud,isalsoknownasIchimokuKinkoHyo,which

translatesintoOneglanceequilibriumchart. Theindicatordefinessupportandresistance,

identifiestrenddirection,gaugesmomentum,andprovidestradingsignals.Itcanalsobeused

withwesternindicatorstohelpconfirmtheirsignals.TheIchimokuCloudcanlook

overwhelmingatfirst,howeveritisverystraightforward,theconceptsareeasytounderstand,

anditssignalsareclearlydefined.

ThislibraryisincludedforPlatinumClubmembers,andmaybepurchasedseparatelyforthe

GoldversionofTradeNavigator.

Benefits:

CommodityTraders: Commoditiestraderscanbenefitfromthisversatileindicatorthatdefines

support/resistance,identifiestrenddirection,andgaugesmomentum. Trendscanbeidentified

usingtheIchimokuCloud,then,classicmomentumoscillatorscanbeusedtoidentify

overbought

or

oversold

conditions.

ForexTraders: Infastmovingcurrencymarkets,Forextraderscanidentifythetrendandlook

forpotentialsignalswithinthattrendwithaquickglance.

StockTraders: TheIchimokuCloudisusableduringrangeboundmarkets,anditsperformance

oftenimproveswhenusedoverlongertimeframes.

TNLIB

021

1011

I c h i m o k u

C l o u d

L i b r a r yPage

1


2/10

LIBRARIES

TNLIB

021

1011

Page

2 I c h i m o k u

C l o u d

L i b r a r y

IncludedinthisLibrary:

Templates

IchimokuCloud Prebuiltchartlayoutwhichreplacesyourchartscurrentindicators

with

the

Ichimoku

Cloud

settings

Studies

IchimokuCloud Prebuiltgroupoffunctionswhichaddsthecloudsettingstoanexisting

chart

Indicators

ChikouSpan representedonthechartsasthecloseoftoday'spriceactionshiftedback

26daysorperiods

KijunLine Forshowingmomentum

Senkou

Span

A

plotted

26

periods

in

the

future

and

forms

the

faster

Cloud

boundary

SenkouSpanB plotted26periodsinthefutureandformstheslowerCloudboundary

TenkanLine Forshowingmomentum

FunctionDescriptions:

Tenkansen:Thedefaultsettingis9periodsandcanbeadjusted.Onadailychart,thislineisthemidpoint

ofthe9dayhighlowrange,whichisalmosttwoweeks.

Kijunsen:

Thedefaultsettingis26periodsandcanbeadjusted.Onadailychart,thislineisthemidpoint

ofthe26dayhighlowrange,whichisalmostonemonth).

SenkouSpanA:ThisisthemidpointbetweentheConversionLineandtheBaseLine.TheLeadingSpanAforms

oneofthetwoCloudboundaries.Itisreferredtoas"Leading"becauseitisplotted26periods

inthefutureandformsthefasterCloudboundary.

SenkouSpanB:

Onthe

daily

chart,

this

line

is

the

mid

point

of

the

52

day

high

low

range,

which

is

alittle

less

than3months.Thedefaultcalculationsettingis52periods,butcanbeadjusted.Thisvalueis

plotted26periodsinthefutureandformstheslowerCloudboundary.

ChikouSpan:Closeplotted26daysinthepast. Thedefaultsettingis26periods,butcanbeadjusted.


3/10

LIBRARIES

TheCloudor

Kumoisthemost

dominatingfeature

ofthistypeof

chart.TheSenkou

SpanA

(green),

whichisthe

averageofthe

KijunandTenkan

lines,andthe

SenkouSpanB

(red),basedoffthe

52dayhightolow

range,formthe

Cloud.Duetothe

factthatHosada's

ideawastohavea

onelookchart,

therearetwoquickwaystodeterminetheoveralltrendusingtheCloud.

First,whenmarketisabovetheCloudtheoveralltrendisbullishandwhenthemarketfalls

belowtheCloud,thetrendisbearish.

Secondly,theuptrendisalsobullishwhentheSenkouSpanAisrisingandabovetheSenkou

SpanB,whichwillproduceagreenCloud.

Bullishsignals

appear

in

the

opposite

formation,

the

Senkou

Span

A

is

falling

and

below

the

SenkouSpanB,whichwillcreatearedCloud.SpanAandSpanBarealsousedassupportand

resistance,sincetheCloudisshifted26days,itidentifiespossibleareasoffuturesupportand

resistance.

TNLIB

021

1011

I c h i m o k u

C l o u d

L i b r a r yPage

3


4/10

LIBRARIES

Thischartshows

theS&P500Index

(TradeNavigator

Symbol:$SPX)ona

dailybarperiod.

Themarket

has

brokenabovethe

cloudandSpanAis

risingaboveSpanB

creatingabullish

trendinthemarket.

Inthischartit

showstheDow

JonesIndustrial

Average(Trade

NavigatorSymbol:

$DJIA)

on

a

daily

barperiod.The

markethasbroken

belowthecloud

andSpanAisfalling

belowSpanB

creatingabearish

trendinthe

market.

TNLIB

021

1011

I c h i m o k u

C l o u d

L i b r a r yPage

4


5/10

LIBRARIES

TenkansenandKijunsenSignals

TheTenkan(blue)andKijun(red)linesarebasedoffofthehightolowrangeofthelast9and

26days.MuchliketheMACD,theselinesareusefulforshowingmomentuminthemarket.The

theoriesbehindtheselinesareusedmuchlikeacrossoverintheMACD.Forexample,abullish

signalthe

market

must

be

above

the

Cloud

and

the

Span

A

line

must

be

rising

above

the

Span

B

line.WithastrongbullishsignalaninvestorshouldlookforacrossoftheTenkanlineabovethe

Kijunline.IfthishappensintheClouditcanbeconsideredamildtomediumsignal,however,if

thisoccursabovetheClouditisconsideredamediumtohighsignal.Ifthecrossabovehappens

belowtheCloudthesignalisnolongervalidduetothefactthemarketwillbetradinginto

resistance.

Movingontothebearishsignals,themarketshouldbebelowtheCloudandtheSpanAlineis

belowtheSpanBline,therefore,thereisabearishtrendinthemarket.

Investors

should

identify

a

crossover

of

the

Tenkan

line

below

the

Kijun

line

for

a

valid

signal.

If

thecrossbelowhappensabovetheCloudthesignalisnolongervalidduetothefactthe

marketwillbetradingintosupport.Wherethiscrossoverhappens,cantelltheinvestors,the

strengthofthetrendorifthetrendwillcontinue.

BelowisachartoftheEuroFXFuturesContract(TradeNavigatorSymbol:G6E067)basedona

dailybar.InthischarttheCloudturnsfromredtogreensignalingapossiblechangeintrend.

OncethemarketbreaksabovetheCloudandtheTenkanlinecrossesabovetheKijunlinea

bullishsignalisconfirmed.TheTenkanLinealsostartstopullawayfromtheKijunlineasthe

trendgetsstronger.

Someinvestors

prefertoholdtheir

positionsuntilthe

Tenkanlikecrosses

belowtheKijun

line,thisindicates

thetrendislosing

strengthand

tradingbackinto

support.

TNLIB

021

1011

I c h i m o k u

C l o u d

L i b r a r yPage

5


6/10

LIBRARIES

Thisisachartofthe

Forexpairingofthe

U.S.Dollar

comparedtothe

JapaneseYen

(TradeNavigator

symbol:$USDJPY)

basedonadaily

bars.

ThefirstcrossoveroftheTenkanlinebelowtheKijunlineoccursatthetopofthecloud.Once

themarketclosesoutsideofthecloudadowntrendisconfirmed.TheTenkanlinethencrosses

backabovetheKijunlineandthemarketisheldatSpanAwherethereisresistance.The

marketcontinuestoridetheSpanAlineforacoupleofweeks.ThentheTenkancrossesonce

againbelowtheKijunlineandclosesoutsideofthecloud,forareentrysignal.Inalarger

downtrendthesesignalscanbeveryrewardingtoinvestors.

Marketand

Kijun

sen

Signals

ThemarketwilloftenpullbacktotheCloudandmeetresistanceorsupport.Inthiscasewhat

aninvestorshouldbelookingforisthemarkettocrosstheKijunline(red).Thisindicatesthat

themarketiseitheroverboughtoroversold.Abullishsignal,themarketwillmeettheCloud

bullishsignalsandthenpullbackundertheKijunline.Thisshowsthatthemarketisinashort

termoversoldareawithinalargeruptrend.OncethemarketbreaksabovetheKijunlinethe

bullishtrendcancontinue.

OftenaninvestorcanenterintothemarketbasedonthissignalorwaitfortheTenkanlineto

cross

above

the

Kijun

line,

for

a

confirming

signal.

The

market

must

line

up

with

the

Cloud's

bearishsignalsandthemarketshouldbounceabovetheKijunlineforbearishsignals.Thistells

investorsthatthemarketisinashorttermoverboughtareaswithinalargerdowntrend.

AfterthemarketpullsbackbelowtheKijunlinethebearishsignaloccurs.Again,theinvestor

canenterintothemarketwiththebreakbelowtheKijunlineorwaitforaconfirmingcrossover

oftheTenkanlinebelowtheKijunline.

TNLIB

021

1011

I c h i m o k u

C l o u d

L i b r a r yPage

6


7/10

LIBRARIES

Thischartshows

Verizon

Communications

Inc.(Trade

NavigatorSymbol:

VZ)on

adaily

bar.

Theoveralltrendin

themarketisup

withthemarket

beingabovethe

greenCloud.The

marketthenpulls

backtotheCloud

andclosesbelow

theKijunline

showingthemarket

hasreachedashort

termoversoldarea.

ThemarketstaysintheCloudforacoupleofdaysthenclosesabovetheKijunlineandabove

theCloud.AfewdaysaftertheTenkanlinethencrossestheKijunlineforaconfirmationsignal.

Thischartshows

ChicagoWheat

(TradeNavigator

Symbol:W2067)

basedon

adaily

bar.Theoverall

trendinthemarket

isdownwhenthe

marketreachesa

tippingpoint.The

marketthencrosses

overtheKijunline,

signifyinganareaof

overbought.The

prices

try

to

reach

theCloudbutnever

makeitandthen

crossbelowthe

KijunlineinmidMarch,soonaftertheTenkanlinecrossesbelowtheKijunlinetoconfirmthe

bearishmove.

TNLIB

021

1011

I c h i m o k u

C l o u d

L i b r a r yPage

7


8/10

LIBRARIES

InmidAprilthemarketturnsbackintotheCloudandismetatresistance.Afterasideways

periodinearlyMaythepricesmovebackbelowtheKijunlineandcloseoutsideoftheCloudto

confirmanotherdowntrend.Shortlythereafter,theTenkanlinecrossesbelowtheKijunlineto

confirmthebearishmove.

ChikouSpan

TheChikouSpanisrepresentedonthechartsasthecloseoftoday'spriceactionshiftedback26

daysorperiods.UsingtheChikouSpanasanadditionalfiltercanbehelpfulaswell.For

example,IftheTenkanlinecrossesabovetheKijunlineinabullishtrend,theChikouSpan

confirmsthetrendifthelineisabovethecloud.StrongersignalsoccurwhentheChikouSpanis

abovetheprice26periodsago.TheChikouSpanisalsousedinasimilarfashiondurninga

downtrend.TheChikouSpanmustbebelowthecloudandforstrongersignalsbebelowthe

priceaction.

ConfirmingBullish

Signal

TNLIB

021

1011

I c h i m o k u

C l o u d

L i b r a r yPage

8


9/10

LIBRARIES

Confirming BearishSignal

Synopsis

TherearefourbasicbullishandbearishsignalsthatarecoveredwiththeIchimokuCloud.

TrendfollowingsignalsrelyontheCloudformedbySenkouSpanAandSpanB. Momentumof

themarketfocusesontheTenkansenandKijunsen,thatrespondsimilartotheMACD.

OverboughtandOversoldareasaredeterminedbythemarketcrossingaboveorbelowthe

slowerhightolowaverageoftheKijunsenline.

Investorsneedtorememberthatitisimportanttonotgetlostinthelinesofthesechartsbut

tofocusontheclearanddirectsignalsthattheIchimokuCloudindicatorcanproduce.The

Cloudofferssupportandresistanceduringlargertrendsandforeshadowswhatistocome.As

always,itismoreadvantageoustotakeadvantageofbullishsignalsinanuptrendandbearish

signalsinalargerdowntrend.

TheIchimokuCloudcanalsobeusedinconjunctionwithwesternindicators.Traderscan

identifythetrendusingtheCloudandthenuseclassicmomentumoscillatorstoidentify

overboughtoroversoldconditions.

TNLIB

021

1011

I c h i m o k u

C l o u d

L i b r a r yPage

9


10/10

LIBRARIES

TN LIB 021 1011 Page 10 I c h i m o k u C l o u d L i b r a r y

BullishSignals:PricemovesaboveCloud(trend)

Cloudturnsfromredtogreen(ebbflowwithintrend)

PriceMovesabovetheKijunLine(momentum)

TenkanLine

moves

above

Kijun

Line

(momentum)

BearishSignals:PricemovesbelowCloud(trend)

Cloudturnsfromgreentored(ebbflowwithintrend)

PriceMovesbelowKijunLine(momentum)

TenkanLinemovesbelowKijunLine(momentum)

i chimo ku clouds

Documents