Ichimoku is a finely-tuned, integrated charting system where the five lines all work in concert to produce the end result. We emphasize the system "system" here because it is absolutely key to understanding how to use the various trading strategies we outline in this section. Every strategy covered below is to be used and measured against the prevailing Ichimoku "picture" rather than in isolation. This means that, while a scenario that matches a given strategy may have transpired, you still must weigh that signal against the rest of the chart in order to determine whether or not it offers a high-probability trade. Another way of looking at it is that Ichimoku is a system and the discrete strategies for trading it are merely "sub-systems" within that larger system. Thus, looking at trading any of these strategies from an automated or isolated approach that doesn't take into account the rest of what the Ichimoku chart is telling you will meet with mixed long-term success, at best. Don't misinterpret the message; the strategies outlined below are very powerful and can bring consistent results if used wisely - which is within the scope of the larger Ichimoku picture. We ask that you always keep this in mind when employing these strategies. If you are interested in discussing these trading strategies in more detail with both the authors and other Ichimoku traders, please visit the Kumo Trader Ichimoku Forum. The signal for this strategy is given when the tenkan sen crosses over the kijun sen. If the tenkan sen crosses above the kijun sen, then it is a bullish signal. Likewise, if the tenkan sen crosses below the kijun sen, then that is a bearish signal. With these three major classifications in mind, we will add something else into the equation - the chikou span. As we explained in the section detailing the chikou spanthis component acts as a "final arbiter" of sentiment and should be consulted with every single trading signal in the Ichimiku Kinko Hyo charting system. If the cross is a "Buy" signal and the chikou span is above the price curve at that point in time, this will add greater strength to that buy signal. Likewise, if the cross is a "Sell" signal and the chikou span is below the price curve at that point in time, this will provide additional confirmation to that signal. However, personal risk management and time frame concerns may dictate an earlier exit, or an exit based upon other Ichimoku signals, just ichimoku in any other trade. Instead, the trader should consider their execution time frame and their money management rules and then look for the appropriate prevailing structure for setting their stop-loss. Since this cross took place within the kumo itself, it is considered a "neutral" buy signal, thus we wait for price to exit and close above the ichimoku to confirm this sentiment before placing our long entry. Price does achieve a close above the kumo at point B 1. For our stop-loss, we look for the place where our trade sentiment would be invalidated. In this case, the bottom edge of the kumo provides us with just that at point C 1. Once we place our entry and stop-loss orders, we merely wait for the trade to unfold while keeping an eye out for potential exit signals. Price rises nicely for the next 10 to 11 days and then, on the 15th day of the trade, price drops enough to have the tenkan sen cross below the kijun sen at point D. This is our exit signal, since Ichimoku is telling us that the sentiment has changed, so we close our order at 1. For maximum risk management on this trade, we also could have moved our stop-loss up with price once price was a conservative distance away from our entry. One option for doing this would be to move the stop-loss up with the kumo, keeping it just below the bottom edge. For even tighter risk management, we could have moved our stop-loss with the kijun sen, keeping it 5 to 10 pips below that line as it moved up. The kijun sen cross is one of the most powerful and reliable trading strategies within the Ichimoku Kinko Hyo forex. It can be used on nearly all time frames with excellent results, though it will be somewhat less reliable on the lower, daytrading time frames due to the increased volatility on those time frames. The kijun sen cross signal is given when price crosses over the kijun sen. If it crosses the price curve from the bottom up, then it is a bullish signal. If it crosses from the top down, then it is a bearish signal. Nevertheless, like all trading strategies within the Ichimoku Kinko Hyo system, the kijun sen cross signal needs to be evaluated against the larger Ichimoku "picture" before committing to any trade. In general, the kijun sen cross strategy can be classified into three 3 major classifications: See the chart in Figure III below for an example of several classifications of the kijun sen cross:. Each of the three classifications of the kijun sen cross outlined above can be further classified based on the chikou span's location in relation to the price curve at the time of the cross. If the chikou span's location in relation to the price curve is the opposite of the kijun sen cross's sentiment, then that will weaken the signal. The entry for the kijun sen cross is very straightforward - an order is placed pdf the direction of the cross once the cross has been solidified by a close. A trader exits a kijun sen cross trade upon their stop-loss getting triggered when price crossing the kijun sen in the opposite forex of their trade. Thus, it is key that the trader move their stop-loss in lockstep with the movement of the kijun sen in order to maximize their profit. The kijun sen cross strategy is unique among Ichimoku strategies in that the trader's stop-loss is determined and managed by the kijun sen itself. This is due to the kijun sen's strong representation of price equilibrium, which makes it an excellent determinant of sentiment. Thus, if price retraces back below the kijun sen after executing a bullish kijun sen cross, then that is a good indication that insufficient momentum is present to further the nascent bullish sentiment. When entering a trade upon a kijun sen cross, the trader will review the current value of the kijun sen and place their stop-loss 5 to 10 pips on the opposite side of the kijun sen that their entry is placed on. When looking to enter Short, the trader will look to place their stop-loss just above the current kijun sen and when looking to enter Long, the trader will place their stop-loss just below the current kijun sen. In this way, the kijun sen itself acts as a "trailing stop-loss" of sorts and enables the trader to keep a tight hold on risk management while maximizing profits. Take profit targetting for the kijun sen cross strategy can be approached in one of two different ways. While the initial cross is above the kumo and therefore a relatively strong cross, it is still beneath a very key chikou span level not visible on this chartso we wait until we get a close above that key level before entering at point B. For our stop-loss, we follow the kijun sen trading strategy guidelines and place it 10 pips below the prevailing kijun sen pdf point C. Once we place our entry and stop-loss orders, we merely wait for the trade to unfold while continually moving up our stop-loss with the kijun sen. Price rises nicely for the next 40 days staying well above the kijun sen. After this point, price begins to ichimoku and, on the 44th day, price crosses the kijun sen and hits our stop-loss at point D closing out our trade and netting us a profit of pips. Kumo Breakout trading or "Kumo Trading" is a trading strategy that can be used on multiple time frames, though it is most widely used on the higher time system e. Daily, Weekly, Monthly of the position trader. Kumo breakout trading is the purest form of trend trading offered by the Ichimoku charting system, as it looks solely to the kumo and price's relationship to it for its signals. System is "big picture" trading that focuses only on whether price is trading above or below the prevailing kumo. In a nutshell, the signal to go long in Kumo breakout trading is when price closes above the prevailing kumo and, likewise, the signal to go short is when price closes below the prevailing kumo. Kumo breakout traders also make good use of the leading kumo's sentiment before committing to a trade. If the leading kumo is a Bear kumo and the kumo breakout is also Bear, then that is a very good sign that the breakout is not an aberration of excessive volatility, but rather a true indication of market sentiment. If the leading kumo contradicts the direction of the breakout, then the trader may want to either wait until the kumo does agree with the direction of the trade or use more conservative position sizing to account for the increased risk. The exit from a kumo breakout trade is the easiest part of the whole trade. The trader merely waits for their stop-loss to get triggered as price exits the opposite side of the kumo on which the trade is transpiring. Since the trader has been steadily moving their stop-loss up with the kumo during the entire lifespan of the trade, this assures they maximize their profit and minimize their risk. Being a "big picture" trend trading strategy, the stop-loss for the kumo system strategy is placed at the point that the trend has been invalidated. Thus, the stop-loss for a kumo breakout trade must be placed on the opposite side of the kumo that the trade is transpiring on, 10 - 20 pips away from the kumo boundary. Ichimoku price does manage to reach the point of the stop-loss, the trader can be relatively assured that a major trend change has taken place. This method allows the trade ichimoku take full advantage of the trend without closing the trade until price action dictates unequivocally that the trend is over. We also see that that leading kumo is distinctly bearish as well, which acts to confirm our breakout sentiment. Given that price is exiting from a flat-bottom kumo and that we want to reduce any risks of entering on a false breakout, we look for a close below the last chikou span support at. The close we are looking for is achieved shortly thereafter at point B and we enter short. For our stop-loss, we follow the kumo breakout guideline of placing it 10 - 20 pips away from the opposite side of the kumo where our breakout is taking place. In this case, we place it 20 pips away from the top of the kumo above our entry candle at point C. Once we place our entry and stop-loss orders, we merely wait for the trade to unfold while continually moving our stop-loss down with the prevailing kumo. Given that we are using the Weekly chart as our execution time frame, we prepare ourselves for a very long-term trade. In this case, nearly two years later, price rises enough to break out of the kumo to the other side, where it triggers our buy order some 20 pips away at point D netting us over pips in the process. The senkou span cross is one of the lesser known trading strategies within the Ichimoku Kinko Hyo system. This is mostly due to the fact that the senkou span cross tends to be more commonly used as an additional confirmation with other trading strategies rather than being used as a standalone trading strategy in its own right. However, it is nonetheless a solid trend trading strategy and can definitely be used on its own. Given that the senkou span cross strategy, like the kumo breakout trading strategyutilize the kumo for signal generation, it is best employed on the longer time frames of the Daily chart and above. The senkou span cross signal is given when the senkou span A line crosses over the senkou span B line of the kumo. If the senkou span A crosses the senkou span B from ichimoku bottom up, then it is a bullish signal. Nevertheless, like all trading strategies within the Ichimoku Kinko Hyo system, the senkou span cross signal needs to be evaluated against the larger Ichimoku "picture" before committing to any trade. The thing to keep in mind with the senkou span cross strategy is that the "cross" signal will take place 26 periods ahead of the price action as the kumo is time-shifted 26 periods into the future. This relationship is obvious when one looks at the current price on a live chart, but less so when looking at historical price action. In addition, while all Ichimoku strategies should be exercised with the larger Ichimoku picture in mind, this is particularly important with the senkou span cross. Thus, determining the overall trend on higher time frames first and then taking only senkou span signals that align with that trend on the lower timeframes is the best implementation of the senkou span strategy. In general, the senkou span cross strategy can be classified into three 3 major classifications: The chart in Figure VII below shows some classifications of the senkou span cross. The dashed vertical lines represent the period relationship between price and the senkou span cross. Thus, point A represents a bullish senkou span cross that can be categorized as a "strong" buy signal due to the fact that price point Bforex the point of the cross, was trading above the kumo. Likewise, point C represents a bearish senkou span cross that generated a strong sell signal due to price's location at point D below the kumo. The senkou span cross at Point E generated a neutral buy signal since price point F was trading within the kumo at that point. The entry for the senkou span cross trading strategy is relatively simple, though, as mentioned above, entries do require even more attention to the overall trend on higher time system before executing any trades. After determining the trend on the higher time frames, the trader looks for a fresh senkou span cross in the same direction as the overall trend that has been solidified by a close on the execution time frame. Once they identify a suitable opportunity, they initiate a position in the direction of the senkou span sentiment. As in all Ichimoku trading strategies, traders will be well-advised to consider the relative strength of the cross vis-a-vis price's location relative to the kumo as well as the sentiment provided by the remaining Ichimoku components at the time of the cross in order to ensure the most optimum entry. It is worth mentioning here that the strong bull buy signal outlined in our first chart that took place in April ofwhile technically strong from a 1D perspective, was not aligned with the overall downtrend in-place on the Weekly and Monthly charts. Thus, traders taking this trade signal and using a senkou span cross in the opposite direction as their exit signal would have actually lost pips. This underscores the importance of evaluating sentiment on multiple time frames and trading with the overall trend. The exit from a senkou span cross trade is generally signalled by a senkou span cross in the opposite direction of the trade, though other exit signals may be taken depending upon the trader's risk tolerance and profit goals. Being a "big picture" trend trading strategy like the kumo breakout strategy, the stop-loss for the senkou span cross strategy is placed on the opposite side of the kumo that the trade is transpiring on, 10 - 20 pips away from the kumo boundary. While traditional take profit targets can be used with the senkou span cross trading strategy, it is forex in-line with the long-term trend trading approach to wait for a senkou span cross to transpire in the opposite direction of the trade before closing out the position. This cross corresponds to the candle at point B. Since the candle closed just below the kumo, the signal is considered a strong one given that its sentiment agrees with the sentiment of the bearish senkou span cross. In addition, we confirm that the direction of this signal is aligned with the overall downtrend in-place on the Weekly and Monthly time frames, so we know that we are trading with the trend. Nevertheless, we are wary of the flat bottom kumo just to the right of the candle, which could act as an attractor for price, so we look for a conservative entry point that will ensure we will not get caught in any false breakouts. The last chikou span support at 1. Price closes below this point a couple of days later at 1. For our stop-loss, we follow the kumo breakout guideline of placing it 10 - 20 pips away from the opposite side of system kumo where our trade is taking place. In this case, we place it 20 pips away from the top of the kumo above our entry candle at point D 1. Once we place our entry and stop-loss orders, we wait for the trade to unfold while continually moving our stop-loss down with the prevailing kumo. In this case, a bit more than four months later, price ranging pdf created a fresh senkou span cross in the opposite direction of our trade at point Ecorresponding pdf the candle at point F where we close out our trade at 1. For those that have been using the Pdf Kinko Hyo charting system for any length of time, utilizing the chikou span cross strategy should be like second nature. Because the forex span cross is essentially the "chikou span confirmation" that savvy Ichimoku traders utilize to confirm chart sentiment before entering any trade. This confirmation comes in the form of the chikou span crossing through the price curve in the direction of the proposed trade. If it crosses through the price curve from the bottom up, then it is a bullish signal. If it crosses from the top down, then it is considered a bearish signal. Thus, we already know the power of the chikou span cross via its use as a confirmation strategy. However, when used within some simple guidelines, the chikou span cross can be used as its own standalone trading strategy with very good success. Like many other Ichimoku trading strategies, the chikou span cross strategy uses price's relationship to the kumo to categorize its pdf into three forex major classifications: The chart in Figure IX below provides several examples of the chikou span system. Given the fact that the chikou span is a measure of closing price shifted 26 periods into the past, we must always keep in mind both the location of the chikou span in relation to the price curve the "cross" itself and the current candle and its relation to the kumo. Thus, Point A1 is the point where the chikou span crossed the price curve downward and Point A2 is the closing candle that initiated that bearish cross. However, since the candle at Point A2 was above the prevailing kumo at the point of the cross, this particular signal would be categorized as a "weak" bearish cross. A strong bullish cross can be seen in Points B1 and B2 since the chikou span crossed upward through the price curve and the closing candle at that point in time was above the prevailing kumo. Points C1 and C2 represent a weak bearish cross given that they transpired above the prevailing kumo. The entry for the chikou span cross is relatively straightforward - the trader initiates a forex in the direction of the chikou span cross after taking into consideration the cross's strength and other chart signals. For the highest probability of success, the trader will also look for the chikou span itself to be free of the kumo as the chikou span can often interact with the kumo much like the price curve. The most traditional exit for a chikou span cross trade is generally signalled by a chikou span cross in the opposite direction of the trade, though other exit signals may be taken depending upon the trader's risk tolerance and profit goals. The chikou span strategy does not dictate use of any particular Ichimoku structure for stop-loss placement, pdf some other strategies do. Take profit targetting for the chikou span cross strategy can be approached in one of two different ways. However, while it is technically a strong cross, the chikou span is still below significant resistance provided by the two chikou span points at 1. In addition, the tenkan sen and kijun sen are in a flat configuration which doesn't provide any additional confirmation. Thus we wait for a more convincing setup before entering Long. This is achieved five 5 days later at Point B1 when the chikou span moves back up through the price curve after a brief dip below. We wait for the daily candle to close and then enter long at 1. For our stop-loss, we consider the prevailing structures and decide to place it just below the kijun sen at 1. Once we place our entry and stop-loss orders, we wait for the trade to unfold. Depending upon our trading style, we could opt to trail our stop-loss along with the kijun sen to keep a tighter rein on risk management or we could utilize the more traditional method of waiting for a chikou span cross in the opposite direction of our trade. In this case, a chikou span cross in the opposite direction takes place just under two months later Point C1 at 1. Alternatively, if we had chosen to use the kijun sen as our trailing stop in this trade, instead of waiting for a chikou span cross, we would have exited somewhere around the 1. Ichimoku trading strategies From IchiWiki - The Definitive Reference to the Ichimoku Kinko Hyo Charting System. FIGURE III - Kijun Sen Cross Classifications. FIGURE IV - Kijun Sen Cross Case Study. FIGURE V - Kumo Breakout Buy Signal. FIGURE VI - Kumo Breakout Case Study. FIGURE VII - Senkou Span Cross Classifications. FIGURE VIII - Senkou Span Cross Case Study. FIGURE IX - Chikou Span Cross Classifications. FIGURE X - Chikou Span Cross Case Study. Retrieved from " http: Article Discussion View source History. This page was last modified This page has been accessedtimes. Contents 1 READ THIS FIRST! About IchiWiki - The Definitive Reference to the Ichimoku Kinko Hyo Charting System Disclaimers Powered by Ichimoku Design by Paul Gu.