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Thread: Ichimoku Kinko Hyo

  1. #1
    Join Date
    Aug 2007
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    Default Ichimoku Kinko Hyo

    Characteristic: Support & Resistance Indicator
    Parameter Defaults: ST Period 26 controls the measurement period for the Kijun Sen
    TL Period 9 controls the measurement period for the Tenkan Sen
    DL Period 52 controls the measurement period for the Senkou Span

    Plots: ST Kijun Sen (Base Line)
    TL Tenkan Sen (Conversion Line)
    DL Chikou Span (Lagging Span)
    Span 1 Senkou Span (Leading Span 1)
    S2 Senkou Span 2 (Leading Span2)

    The term "Ichimoku" can be translated from Japanese as "instant view or "one glance", "Kinko" is the equivalent of "equilibrium" or "balance" and "Hyo" means "chart". Hence the full name "Ichimoku Kinko Hyo" actually means "one glance cloud chart" or more appropriately "Instant view of the balance chart". Goichi Hosoda developed Ichimoku Kinko Hyo in the early Showa era (1926-1989) and copyright is owned by Kabushiki Kaisha Hendou Souken. However, Hosoda, a Japanese newspaper writer, only published his findings in 1969 and from that point forward Ichimoku Kinko Hyo has become a permanent feature in Japanese trading rooms.

    The series of lines are very similar to moving averages and are based upon high and low prices. The two Senkou Span (leading) lines are pushed forward in time to represent past support and resistance similar in concept to the idea that once established, support will continue to provide support until broken when it becomes resistance. The area between the two Senkou Span lines is shaded to make it look like a cloud. This "cloud" not only defines the trend but acts as support and resistance for price. A very basic precept is: if price is above the cloud then the trend is higher and vice versa.

  2. #2
    In Profit
    Join Date
    Sep 2007
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    some explanation from http://www.metaquotes.net/techanalys...ators/ichimoku

    Ichimoku Kinko Hyo Technical Indicator is predefined to characterize the market Trend, Support and Resistance Levels, and to generate signals of buying and selling. This indicator works best at weekly and daily charts. When defining the dimension of parameters, four time intervals of different length are used. The values of individual lines composing this indicator are based on these intervals:
    • Tenkan-sen shows the average price value during the first time interval defined as the sum of maximum and minimum within this time, divided by two;
    • Kijun-sen shows the average price value during the second time interval;
    • Senkou Span A shows the middle of the distance between two previous lines shifted forwards by the value of the second time interval;
    • Senkou Span B shows the average price value during the third time interval shifted forwards by the value of the second time interval.
    Chinkou Span shows the closing price of the current candle shifted backwards by the value of the second time interval. The distance between the Senkou lines is hatched with another color and called "cloud". If the price is between these lines, the market should be considered as non-trend, and then the cloud margins form the support and resistance levels.
    • If the price is above the cloud, its upper line forms the first support level, and the second line forms the second support level;
    • If the price is below cloud, the lower line forms the first resistance level, and the upper one forms the second level;
    • If the Chinkou Span line traverses the price chart in the bottom-up direction it is signal to buy. If the Chinkou Span line traverses the price chart in the top-down direction it is signal to sell.
    Kijun-sen is used as an indicator of the market movement. If the price is higher than this indicator, the prices will probably continue to increase. When the price traverses this line the further trend changing is possible.
    Another kind of using the Kijun-sen is giving signals. Signal to buy is generated when the Tenkan-sen line traverses the Kijun-sen in the bottom-up direction. Top-down direction is the signal to sell.
    Tenkan-sen is used as an indicator of the market trend. If this line increases or decreases, the trend exists. When it goes horizontally, it means that the market has come into the channel.

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  3. #3
    Join Date
    Jun 2007
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    This site has information on Ichimoku Kinko Hyo and its application to the Forex market:



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