Ichimoku Strategy Learn The Ichimoku Trading Strategy At CAPEX.com

• Isolation and analysis: An Ichimoku strategy will isolate the best probability trades in your chosen instrument, and will help you secure them.
• Tenken and Kijun Sens: Both the Tenken and Kijun Sen line calculate the sum of the highest high and lowest low trades, and divide them by two. The difference is that they take different time periods into account. They both are critical in getting an average in changing trends, and trade entry points
• Chinoku Span: The Chinoku Line is a line that shows the most recent price action, but compares it to 26 previous trade periods. It helps traders establish an important relationship between current and previous trends.

Opportunities – the advantages of using Ichimoku Strategies when trading

• Clarity: An Ichimoku strategy merges three essential indicators onto one graph to provide a clear chart of where the market is heading. The crossover points of the Tenken and Kijun lines are great indicators on knowing a trades value, and provides the trader with enough previous trends for them to make their own calculations. Once you understand an Ichimoku strategy, it helps everything become clearer.
• Support: A good Ichimoku trading strategy always has failsafes and stop-loss orders in place, like the ones you can use at CAPEX, to allow you to predict when a trade is about to fall off. With ‘the Cloud’ essentially predicting when a trade is about to hit a trend and become profitable, it gives you plenty of time and room to sell before you risk losing too much capital.
• Direction: An Ichimoku strategy is great at predicting the direction a certain instrument will go. By predicting these trends with certain trades, it’s a great indicator that shows the general direction and intensity of a market moving into the future.

Risks – The pitfalls of over relying on an Ichimoku trading strategy

• Reliance on historical data: The biggest downfall of an Ichimoku strategy is also an advantage of it. It relies heavily on historical data of previous trends in order to predict current trends. But, as seen in our best Forex trading tips article, trends may not always repeat themselves in a volatile market.
• Overwhelming: For traders, an Ichimoku cloud often looks chaotic and messy. It can be overwhelming for brand new traders to try take the time to understand what everything in an Ichimoku strategy comprises of, and it does take someone that is extremely focused and dedicated
• Too narrow: On most occasions, traders will use Ichimoku strategies to focus on smaller time periods, and that’s where a great Ichimoku trading strategy excels. However, the inability to focus on a wider timeframe ultimately limits a great Ichimoku strategy. This can ultimately lead to a number of false signals, if the time period you are focusing on doesn’t have any noticeable trends or shifts.

• Tenkan sen (red line): A moving average. It calculates the sum of the highest high and lowest low and divides by two, over the last nine periods.
• Kijun sen (blue line): Similar function to the Tenkan sen. The only difference is it calculates the previous 26 periods, which means it moves slower than the Tenkan sen.
• Chinoku Span (green line): This line represents the current price action, but it’s shifted to the left by 26 periods.
• Senkou Span (orange/bright blue): This span is composed of two lines.
  • The first line is the current average of the highs and lows of the Tenken Sen and the Kijun Sen, moved 26 periods to the right.
  • The second line is the middle point between the highest point and the lowest point for 52 periods. This line is also moved 26 periods to the right.
  • ‘The Cloud’ is the area in this chart that both of the above lines operate in. It also represents the further support and resistance level, where it’s recommended you should make your trades

Now that you understand what everything does, we’ll show you the buy trading Ichimoku Strategy.

1. First of all, look above the ‘Cloud’ for a price strike. If it’s above the Cloud, it’s bullish and potentially the start of a new trend. This means the price is a ‘support’ system. If it was below the cloud, it would be a ‘resistant’ system
2. The price strike above the Cloud needs to be trailed by an intersection of the Tenken sen line and the Kijun sen line. Now you have all the conditions to buy a trade.
3. You’re generally in for a long trade now it’s above the Cloud. Buy the trade after the crossover, rather than as soon as it happens. This takes other factors into account, like the stability of the trade.
4. Put an automatic stop loss, easily done at CAPEX, at the lowest point off the intersection. You’re insuring yourself against a possible crash with minimal risk this way. It also gives you the opportunity to exit the position quickly when another crossover happens.
5. To be safe, sell when the Tenken sen line crosses underneath the Kijun sen line.

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We give you the free will and flexibility to use a whole variety of Ichimoku strategies to suit you. If you want to trade non stop, 24 hours a day with a great Ichimoku strategy focusing on crypto and quick trades, we can accommodate for that with our wide selection of cryptocurrencies and an Ichimoku cloud that adapts well to the instrument. If you want to focus on Forex and open more long positions to gain potential bigger profits, with less frequent trades, we can accommodate that.

We have the best possible selection of Forex trades at your disposal, and the best spreads that your Ichimoku Strategy will be able to pick up on, and capitalise on. In short, no matter what direction your Ichimoku trading strategy takes, our CAPEX.com trading platform will accommodate it, as well as all other online trading strategies that you want to use.

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