Trend Indicators

Ichimoku Cloud

Ichimoku Kinko Hyo is a versatile indicator that defines support and resistance, identifies trend direction, gauges momentum, and provides trading signals. The "Cloud" (Kumo) is its most unique feature.

Dynamic Chart Demo

Indicator Line Price

* This chart uses synthetic data to demonstrate the indicator's behavior in typical market conditions.

Core Usage

Cloud color indicates trend (Green = Bullish, Red = Bearish)

Price relative to Cloud (Above = Bullish, Below = Bearish)

TK Cross (Tenkan-sen crossing Kijun-sen)

Advantages

Provides multiple data points in one glance
Effective at identifying dynamic support/resistance
Strong trend confirmation tool

Limitations

Can look very cluttered and complex on charts
Not effective in non-trending/ranging markets
Steep learning curve for beginners

Calculation Logic

Tenkan-sen = (9-period High + 9-period Low)/2, Kijun-sen = (26-period High + 26-period Low)/2, Senkou A = (Tenkan + Kijun)/2 plotted 26 bars forward, Senkou B = (52-period High + 52-period Low)/2 plotted 26 bars forward, Chikou = Close plotted 26 bars back

Understanding the mathematical logic behind indicators helps you interpret signals more accurately and avoid misuse in unsuitable market environments.

Common Trading Strategies

Strategy 1

Kumo Breakout

Buy when price breaks above the cloud; Sell when it breaks below.

Illustrative example

BUY

SELL

2 signals · Kumo Breakout

Buy

Sell

Strategy 2

TK Cross

Bullish when Tenkan-sen crosses above Kijun-sen while price is above the cloud.

Illustrative example

BUY

SELL

2 signals · TK Cross

Buy

Sell

Best For

"Comprehensive market analysis and trend following."

Note: Technical indicators are mathematical calculations based on historical price and volume. They should be used as part of a comprehensive trading system, not as a standalone entry signal.

Build System with Ichimoku Cloud

Automate your trading logic with our no-code strategy builder.