The final indicator that we will explain is the Ichimoku indicator which is becoming more popular in spite of its relative complexity. It must be said that it only seems complex because it looks like an accumulation of lines. Once you have used the Ichimoku indicator for some time then its lines can become your faithful friends and you will no longer confuse them with each other because every line has its function and role. It is possible to master the Ichimoku indicator which exceeds a lot of indicators in accuracy and effectiveness. Like the Japanese candles, the Ichimoku indicator comes from Japan. It is used to understand the overall condition of the market in its current state and for identifying trends and searching for the best opportunities to make winning trades.
So, if you add the Ichimoku indicator (which is created directly on the price chart) to your chart then another five lines, which make up the indicator, appear on it.
What kind of lines they are? What is the right way to use them?
These two lines are the same as fast and slow MA (moving averages). When the Tenkan line crosses above the Kijun line it indicates that the price will most likely go up soon. Such a crossing is called a “gold cross”. But when the Tenkan line crosses below the Kijun line this crossing is called a “dead cross” and indicates that the price will go down.
The “cloud” itself is very interesting because its location against a price indicates current market conditions. It is easy to guess that if the price is above the “cloud” then there is an uptrend; if it is lower then there is a downtrend. And if the price is in the cloud then there is a “corridor”.
Important notice: when the price is in the “cloud” then most of the Ichimoku indicator’s signals DON’T WORK! In this case it would be recommended to use the signals of indicators such as RSI or Stochastic.
The moments when the price enters and exits the “cloud” are very significant. If, for example, the price exits the “cloud” and goes down, then it signals a strong downtrend. Boundaries of the “cloud” are, in fact, good support and resistance levels which are displayed along with the chart, so they don’t need to be adjusted.
The nice thing about the Ichimoku indicator is
We can see three signals here at once. If they trigger simultaneously then you should buy the option. Such “self-verifiability” of the Ichimoku indictor is its key benefit while other indicators’ signals need to be verified by other indicators or the same patterns of technical analysis (such as triangles or support lines).
Спасибо за регистрацию в компании CT Trade.
Через 2 минуты (возможно и раньше) Вы получите письмо, в котором Вам необходимо подтвердить свой e-mail. Если в течение этого времени Вы не получили письма с подтверждением, то возможно, оно попало в папку со спамом. Пожалуйста, проверьте содержимое этой папки.