EDUCATION: Ichimoku - Part 2

2020년 12월 23일

Today we continue to study Ichimoku Indicator trading strategies. Last time we analysed in details the conversion, base and lagging span lines. In this article we apply Kumo cloud which is formed by Leading Spans A and B. The formulas for the calculation you can see on the chart.

The Strategy
Before considering the strategy we should understand that the Kumo cloud is projected forward for 26 periods. The simpliest version of the Ichimoku strategy employs just the Kumo cloud. We just should define the point where the Lagging Span A crossed the Span B from down to up and execute the long position.

It is also recommended to define the long positions entry points more strictly. The price should be above the Kumo cloud and the conversion line should cross the base line from down to up near the Span A and Span B crossover.

When to exit? You can exit long positions with three possible ways on your own preferences:
1)When the price crossed the Kumo
2)When the Span A crossed the Span B from up to down
3)When the conversion line crossed the base line from up to down
You should test it by yourself.