Over one year ago I started with Ichimoku, I spent a lot of hours before I understood it correctly. I took a while but finally It becomes a profitable system. In this article in simple words I will describe how ichimoku works and how it can be used in trading.
Ichimoku is complex strategy invited by Goichi Hosoda. Complex means that it can be use alone without any others indicator. Ichimoku is a trend following strategy, that means that it won’t catch tops and bottoms but it tells us that we are in trend (Not in a correction). This strategy also show exact entry and exit poins! We have few techniques. (I will describe all of them).
To be honest, it is not Holy Grail as false signals happend but I’ll describe how they can be minimalized.
Lets go to the point:
Ichimoku has five lines:

1. Tenkan Sen
2. Kijun Sen
3. Chikou Span
4. Senkou Span A
5. Senkou Span B
I will add line by line and explain them:
1. Tenkan Sen (formula (HH+LL)/2 from last two periods).
For us it is very important line, we open positions only in accordance with this line!
2. Kijun Sen (formula (HH + LL)/2 from last 26 periods)
Second important line, signals I will describe later but this line can be use also as …
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