Ichimoku Cloud

The Ichimoku Cloud (Ichimoku Kinko Hyo) is a comprehensive indicator that shows trend, momentum, support/resistance, and future projections. It consists of five lines: Tenkan-sen, Kijun-sen, Senkou Span A, Senkou Span B, and Chikou Span. The cloud (Kumo) is the area between Senkou A and B.

Tenkan-sen (Conversion): 9-period midpoint of high-low. Kijun-sen (Base): 26-period midpoint. Senkou Span A: Midpoint of Tenkan and Kijun, plotted 26 periods ahead. Senkou Span B: 52-period midpoint, plotted 26 periods ahead. Chikou Span: Close, plotted 26 periods behind. Price above the cloud is bullish; below is bearish.

Key signals

1. Cloud: Price above cloud = uptrend; below = downtrend. Cloud acts as support/resistance.
2. Tenkan/Kijun cross: Tenkan above Kijun = bullish; below = bearish.
3. Price vs Kijun: Bounces off Kijun in trends.
4. Chikou Span: When Chikou is above price (looking back), confirms bullish. Below price confirms bearish.

Default 9, 26, 52. These are standard. Some use 10, 30, 60 for different markets. Stick to defaults unless you have a reason.

Ichimoku has many components—do not overcomplicate. Focus on: price vs cloud, Tenkan/Kijun cross, and Chikou confirmation. Avoid using all signals at once. The cloud is the most important element.