Alright, I know a lot of traders(especially newer traders) aren’t too familiar with the Ichimoku Kinko Hyo trending system, and some more (so-called) experienced traders have a downcast opinion of it.
Personally, this is the greatest system I’ve ever used, and I’ve messed around with a lot of them over the past few years, from MA crossovers to Bollinger Band trading to Volume trading… there’s a lot of systems out there. And I’m not saying they’re all bad. MOST systems are able to turn a profit. This just happens to be the system I’ve personally found to do so in the soundest manner. So basically I’m just starting this thread to offer education, advice, and discussion on the Ichimoku.
I’ve also attached something known as the IchiWiki, it’s pretty much the Bible as far as Ichimoku traders are concerned, both new and old alike. Hope it’s useful to everyone, may it be people who share an appreciation for Ichimoku, or for people who can use this information to determine that Ichimoku isn’t for them before they lose money on it. God knows there’s enough money traps out there as it is.
Sweet Josh. There’s already an Ichimoku thread here. I’ve read this and it is a very good reference! Mods, why not merge this to the other thread so everything is in the same spot?
Yep, ichi is a great indicator set to get an overall picture of a pairs direction or if it’s in a range.
I think the reason some look down on it, is that there are many different ways to to trade using strictly ichi. So, a lot of user error can be introduced into it.
Also, it’s basically a longer term trading indicator, daily and up. Some people likely tried to use it on smaller time frames and found that while it looks like it should work on smaller time frames it doesn’t pan out (myself included). But, it was never designed for anything smaller than daily charting.
Myself I use it for a filter on daily and weekly to confirm the overall trend diretion and help draw support and resistance with the chickou span. (Drawing S&R is what ichi does best IMO, you can see bounces off the lines it draws almost to a pip)
I agree but the trader has to have to have the mindframe to trade it on a daily chart , which takes some experience. It’s no good using ichi if you just want 10pips.
Here’s one of my trades where I used the daily and hourly chart for a stock swing trade. Most of my plays consist of looking for a bucket where I’m anticipating the trend reversal. This is the pivotal point in a downtrend when price has crossed above TS and KS is above both TS and Price. At that moment, this is considered our range for trading. During this time, it’s also good to look stochs for short term movement and TRIX for an uptrend confirmation.
Make no mistake about Ichimoku. It is NOT for short-term scalping. Even using Ichimoku for intraday trending has it’s risks. This is an indicator strictly for identifying long-term trends. Personally, I use Ichimoku to make ‘short’ term trades based on 30min and 1Hour charts that usually last around 6 - 12 hours, but the system shines best when used in the Daily charts, I completely agree with SanMiguel and The Phoenix. I HAVE met people that use Ichimoku with moderate success in shorter-term trending, but it has had severe drawbacks, namely because you have to be very liberal with you SLs. That leaves you open to some very dangerous reversals, to say the least.
However, I have found over the past little while that my technique to investing in 1Hour charts is not very different from how I apply the system to the Daily charts. The only difference is I have to be MUCH more patient with the Daily charts. It can be particularly nerve-wracking to SOH while a trade develops over 3 or 4 days, or weeks on some occasions.
IMO, trading larger time frames is much less work and TA is much more reliable.
I think the real issue is that most new traders are misinformed and think that smaller time frames are easier to trade, and that you can’t trade larger ones unless you have a huge account.
Shorter TFs are certainly NOT easier to trade than longer TFs. The market reacts much, much faster to shorter TFs, and makes you much more susceptible to whipsaws. Longer term trading I would have to say is the safest way to go for new traders. The only part that new traders have a hard time dealing with is having to use much smaller lot sizes than their math told them they could use on intraday trading.
I would like to take a chance to say thank you for pdf(s)
Don’t merge your thread to any others. Just start your own presentation from the very beginning that even new babies as I am be able to understand the IchiWiki
Unfortunately, I believe SanMiguel is right about small profit traders. Most of the traders I meet along my travels have big profits in mind, but they degrade their trading style into nothing more than extreme scalping. They sit at their computer and take trades with 3 and 4 pip profits; they do this all day. That’s not investing smart, as far as I’m concerned. They call then whipsaws for a reason. They hurt you.
So about a month ago, I made the biggest newb mistake I’ve made since… I was a newb. I was getting frustrated with the lack of decent signals from Ichimoku Kinko Hyo, and switched to another system. Every professional trader knows changing systems because of frustration with the markets is a bad thing to do. I should have known better, but I did it anyway. So a couple of weeks ago I realized the err of my ways, and relegated myself to the rank of demo trader until I felt my head was in the right place. Now I’m back to trading like a big boy with the help of my good buddy Goichi Hosada, and let’s see if I can’t scrape some coin out of these markets. I’ll be doing my best to give daily updates and weekly reviews from here on out.
