Ichimoku

What is Ichimoku?

Ichimoku is a technical analysis method that is used to identify trends and support/resistance levels in financial markets. It is a complex system that includes several elements, including the following:

• The "Tenkan-sen" line, which is a moving average of the highest high and the lowest low over the past 9 periods.
• The "Kijun-sen" line, which is a moving average of the highest high and the lowest low over the past 26 periods.
• The "Chikou Span," which is the current closing price plotted 26 periods behind the current time.
• The "Senkou Span A" and "Senkou Span B," which are the midpoints of the Tenkan-sen and Kijun-sen lines plotted 26 periods forward.

Ichimoku is used to identify trends, support and resistance levels, and potential buy and sell signals. Traders often use the position of price relative to the cloud (formed by Senkou Span A and B) as a key indication of the trend, a price above the cloud indicating a bullish trend, below it a bearish trend. Also, the cross of the Tenkan-sen and Kijun-sen lines is used as a signal for potential trend changes.