Article

27/43
Ranking
Introduction Earlier this month I introduced the Ichimoku charting system, defining the components of the system. I also eluded to a simple strategy that utilises all these components – the teken sen/kijun sen cross. This simple strategy can be used in all time-frames, although I normally use this setup for swing trading. In response to a comment on this article, I would like to introduce another strategy that is more ideal for those of you who are more interested in day trading – the kijun sen setup. In this article, I will describe this setup in detail. I advise you to read the previous article posted earlier this month if you either do not understand the main components of Ichimoku, or just need a refresher of the overall system. It can be found here: http://www.dukascopy.com/fxcomm/fx-article-contest/?Ichimoku-Trading-An-Introduction-With&action=read&id=1100The Kijun Sen Cross for Day Trading For this setup, I normally use two timeframes, 5 min and 30 min. The strategy can be summarised as follows: In both timeframes, wait for a candle to cross the kijun sen. Once a candle completes over the kijun sen in the lower timeframe, place an order using the kijun sen +/- 10 pips as a b…
Read article
Translate to English Show original
auto1 avatar
auto1 11 Dec.

Very well defined and explained. Nice strategy

auto1 avatar
auto1 11 Dec.

For day trading in 5m ,Is the cloud condition same as discussed in your earlier article?

Lottithecat avatar

Good point: for this particular strategy, no, you just follow the actual cross, regardless of where it is. This means you can get more trades in per day, but you will have more trades stopping out early. You can refine this strategy by only trading above the cloud for bullish trades, and below the cloud for bearish trades to increase the probability of getting a winning trade, but the number of trades you make will decrease substantially. If however, you look at multiple low spread currencies at the same time, then refining the above using the kumo makes it a very powerful strategy indeed.

orto leave comments
7/43
Ranking
Introduction Ichimoku Kinko Hyo (commonly just shortened to Ichimoku) is a Japanese charting system created in the 1930’s by Goichi Hosoda. It is commonly used to assist in entry and exit points in trending markets, is popular in Japan, and recent years has gained popularity in the west. You may have heard of this charting system, given it a quick try, or maybe you’re a seasoned pro at using it! In any case, this article will briefly introduce the system for using Ichimoku in a FOREX setting and demonstrate a quick and easy strategy to follow. Pertinent features of Ichimoku will be discussed and throughout the month, I will use this strategy to demonstrate prospectively how this strategy can be used and I intend to write a follow-up article to critique this trading system using this simple setup.Components of the system These are as followsTekan sen – (highest hi + lowest low)/2 for the past 9 periods.Kijun sen – (highest hi + lowest low)/2 for the past 26 periods.Chikou span – current price moved back 26 periods.Senko span A – (Tekan Sen + Kijun Sen)/2 moved forward 26 periods.Senko span B – (Tekan Sen + Kijun Sen)/2 for the past 52 periods moved forward 26 periods.Kumo (“cloud&rd…
Read article
Translate to English Show original
auto1 avatar
auto1 4 Dec.

Nice strategy, What time frame do you recommend for day trading purpose, Take profit and and stop loss may also be explained please.

Lottithecat avatar

For day trading, I would use 5 minutes, while keeping an eye on a higher time frame (e.g. 1 hour).

Stop loss is normally at the kijun sen. Some advocate a "buffer" below the kijun sen (I would use the equivalent of the ATR) just to make sure you don't get stopped out before a major trend develops for a typical positional or swing trade. You normally take profits at the point where the cross is reversed. This will inevitably mean that you will lose some pips at the end of the trade, but at least you can be sure the trend has changed.

Lottithecat avatar

Next week, I'll follow up this article with one dedicated to the specifics of day trading, as the comments box is not really suited for that purpose. I normally use this particular strategy for swing trading, and I have used this setup for day trading successfully too. However, if you want to reduce drawdown, and squeeze more trades in, there is another setup, the kijun sen setup, that you can use to reduce your capital exposure. I'll explain more next week!

Lordy_zita avatar

Well explained, well summarized. +1

Likerty avatar
Likerty 7 Dec.

I used ichimoku cloud some time ago too.. Thats a strange indicator - have its own magic in some way..:))

orto leave comments