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Ichimoku Forex Forecast by Integra Capital Ltd.
23-29 October 2006
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23-29 October 2006
Ichimoku Forex Forecast by Integra Capital Ltd.
24.10.2006
USDCHF
On Monday the Swiss franc essentially rose, having continued to rise in price and in today's Asian session. Rise of the price above fast trend line TS points to attempt of renewal of a Bullish trend, as all IKH-patterns: a finding of a rate above Como, and ChS above the price chart, "a golden cross", "a tree-line pattern" and future Up Cumo also testify to probability of continuation of rise. But trend lines TS and KS while are horizontal, that means continuation of consolidation, therefore mount of support TS will give a pattern finally confirming renewal of the up trend.
EURUSD
The rate of euro on Monday fell, and in today's Asian session it remained practically constant. Decline of a rate under fast trend line TS means possible to renewal of a down trend, about kept which strength now speak all IKH-patterns: a disposition of the price below Cumo, and ChS below the price chart, "a deadly cross", "a tree-line pattern" and future Down Cumo. But horizontality of trend lines TS and KS points to a proceeding consolidation, therefore a final pattern to renewal of a trend will give decline of resistance TS.
GBPUSD
On Monday the rate of the British pound has accurately pullback from resistance on the Cumo's upper boundary SSA and considerably decreased, and in today's Asian session it oscillated at one level. Preservation of a rate within the Cumo means continuation of flat dynamics of the British currency between support SSB and resistance SSA. Herewith many IKH-patterns (decline of ChS under the price chart, disposition TS below KS and future Down Cumo) speak about probability of continuation of fall of the British currency.
USDJPY
The Japanese Yen on Monday continued the steady rose, mounted above fast trend line TS, and in today's Asian session its rate remained almost constant. Horizontality of trend lines TS and KS means that consolidation still is not finished, but rise of a rate above support TS together with other IKH-patterns: a disposition of the price above Up Cumo, and ChS above the price chart, "a golden cross" and "a tree-line pattern" unanimously testifies to renewal of an up trend. A final pattern to this will be rise of fast trend lines TS.
USDCAD
On Monday the Canadian dollar rebounded from support on the Cumo's upper boundary SSB and rose, having continued mount and in today's Asian session. It means end of deep descending correction and is the first pattern about an opportunity of renewal a Bullish trend. As disposition ChS above the price chart, "a golden cross" and future Up Cumo, also speak about probability of the further growth. But recently the rate is consolidated between horizontal trend lines TS and KS, and mount of the price above raising resistance TS becomes a final pattern to renewal of an up trend.
AUDUSD
The Australian dollar on Monday pullback from resistance on the Cumo's upper boundary SSA and fell, and in today's Asian session it has risen again. Oscillations of a rate within the Cumo, speak about flat dynamics of the Australian currency between support SSB and resistance SSA. Herewith rise of ChS above the price chart and mount the conterminous trend lines TS and KS gives a pattern about an opportunity of continuation of rise, but future Down Cumo testify to probability of falling of a rate of the Australian currency.
NZDUSD
On Monday the New Zealand dollar considerably fell in price, down to support on fast trend lines TS, but in today's Asian session it has renewed the rise. If by results of the today's trades the rebound of the price from TS will prove to be true, it becomes additional confirmation of strength of an up trend, on which presence now speak all IKH-patterns: a disposition of the price above wide Up Cumo, rise ChS above the price chart, "a golden cross" and "a tree-line pattern". But in case of the further falling, the rate will start the descending correction. While recently the horizontality of trend lines TS and KS testifies about market consolidation.
GBPCHF
Cross-rate of the British pound to the Swiss franc on Monday continued the rise, and today's Asian session it remained almost constant. Now all IKH-patterns: a disposition of a rate above wide Up Cumo, and ChS above the price chart, "a golden cross" and "a tree-line pattern" speak about continuation of a long-term up trend on the cross-rate. The rate of the British pound to US dollar now has flat dynamics in a stage of decline, and the Swiss franc, tries to renew an up trend that points to probability of consolidation of cross- rate of these currencies.
On Monday the US dollar managed to restore the positions lost in the end of the last week. The Swiss franc and the Japanese Yen renew up trends, and the Canadian dollar has consolidated with probability of rise. The euro tries to renew a down trend, and the British pound and the Australian dollar have continued of flat dynamics. The New Zealand dollar has fallen in price and has consolidated at top of an up trend, and cross-rate of the British pound to the Swiss franc continues long-term a Bullish trend.
25.10.2006
USDCHF
On Tuesday and today's Asian session the Swiss franc oscillated at a level of fast trend line TS and a yesterday's candlestick "long-legged doji", together with horizontality of trend lines, speaks about market consolidation. Renewal of rise of the rate, accompanied by rise of TS will give a pattern about renewal of an up trend, kept which strength now point to all IKH-patterns: a disposition of a rate above Cumo, and ChS above the price chart, "a golden cross", "a three-line pattern" and future Up Cumo. At the same time falling of a rate below TS will mean consolidation of the price between trend lines TS and KS.
EURUSD
The rate of euro on Tuesday oscillated at one level, formed a candlestick "a white spinning top" with the long shadows, which testifying to balance and uncertainty in the market, and in today's Asian session it has risen. Horizontality of trend lines TS and KS speaks about consolidation of a rate between its, and the further rise in price of euro will confirm consolidation. At the same time, the majority of IKH-patterns: a disposition of the price below Cumo, and ChS below the price chart, "a deadly cross", "a three-line pattern" and future Down Cumo speak about kept of strength of a Bearish trend. Falling of the price of the European currency under declining fast trend line TS will give a pattern to trend renewal.
GBPUSD
On Tuesday and today's Asian session the rate of the British pound oscillated at one level, remaining within the Cumo that means continuation of flat dynamics between support SSB and resistance SSA. Horizontality of trend lines TS and KS also speaks about consolidations of the British currency, but decline of ChS under the price chart, disposition TS below KS and future Down Cumo testify to probability of fall of a rate.
USDJPY
The Japanese Yen on Tuesday a little fell, formed a candlestick "a white spinning top" which together with the previous big white candlestick, forms a configuration "star" often previous a turn of the tendency. And, really, in today's Asian session the rate has started to fall. Herewith horizontality of trend lines TS and KS means, that consolidation still is not finish, but many IKH-patterns: a disposition of the price above Up Cumo, and ChS above the price chart, "a golden cross" and "a three-line pattern" testifies to an opportunity of renewal of an up trend. A final pattern to this will be rise of fast trend lines TS, under condition of preservation of the price above it.
USDCAD
On Tuesday the Canadian dollar intensively oscillated above Cumo, a little fell on the results of day, and in today's Asian trading session it has continued slow falling. Vicinity of ChS to the price chart and horizontality of trend lines TS and KS speaks about consolidation of a rate between them. But preservation of a rate above Cumo, "a golden cross" and future Up Cumo, testify to kept probability of rise. Mount of the price above upsurge resistance TS will give a pattern to renewal of an up trend whereas breakout of supports on KS and SSB downside and an entrance of rate into the Cumo will mean begin of flat dynamics. While a situation with the Canadian currency is ambiguity.
AUDUSD
The Australian dollar on Tuesday rose in price and has got to resistance on SSA, formed a candlestick configuration "a piercing lines", usually forecasting the further rise of a rate which was observed in today's Asian session. If on results of the today's trade the price will manage to be kept above Cumo, it will mean end of flat dynamics and occurrence of premises for the beginning of an up trend on the Australian currency. Rise of ChS above the price chart and "a golden cross" give a pattern about such opportunity. But future Down Cumo testify about probability of falling of a rate of the Australian currency, therefore it is necessary to wait the further IKH-patterns.
NZDUSD
On Tuesday the New Zealand dollar continued the falling, breakout the first support on fast trend lines TS downside, and the got to the second support on the basic trend line KS, and in today's Asian session the rate has slightly risen. Oscillations of a rate at a level of horizontal trend lines with the interlacing of ChS with the price chart speak about continuation of consolidation of the New Zealand currency at top of a Bullish trend. However a disposition of the price above wide Up Cumo and "a golden cross", point to an opportunity of renewal of an up trend. A pattern to this will be mount of the price above raising TS whereas falling of price below KS becomes the beginning of deep descending correction with the target on the Cumo's upper boundary SSA.
GBPCHF
Cross-rate of the British pound to the Swiss franc on Tuesday and today's Asian session remained almost constant. Herewith all IKH-patterns: a disposition of a rate above wide Up Cumo ", and ChS above the price chart, "a golden cross" and "a three-line pattern" testify to continuation of a long-term Bullish trend on the cross-rate. The rate of the British pound to US dollar now has flat dynamics, and the Swiss franc also was consolidated, that points to probability of consolidation of cross-country-rate of these currencies.
On Tuesday the US dollar showed weak volatility to the major currencies. The Swiss franc, the Japanese Yen and the Canadian dollar was consolidated, not having managed to renew of the up trends yet. Euro also was consolidated, not having begun a down trend, and the British pound and the Australian dollar continued flat dynamics though on "Australian" there were patterns of its finish and possible to rise. The New Zealand dollar becomes cheaper and is consolidated at top of an up trend, and cross-rate of the British pound to the Swiss franc continues a long-term Bullish trend.
26.10.2006
USDCHF
On Wednesday the Swiss franc declined and formed a candlestick configuration "evening doji-star", usually previous falling. And, really, in today's Asian session the rate has continued the fall, having declined below fast trend line TS. It means renewal of descending correction with the target of falling on support KS. Horizontality of trend lines, points to consolidation of a rate between them, but the majority of IKH-patterns: a disposition of a rate above Cumo, and ChS above the price chart, "a golden cross" and future Up Cumo, speak about an opportunity of renewal of a Bullish trend. A pattern to this will be mount of the price above upsurge TS.
EURUSD
The rate of euro on Wednesday rose and again mounted above fast trend lines TS, formed a candlestick configuration "a morning star", forecasting rise which was observed in today's Asian session. Horizontality of trend lines points to consolidation of a rate of the European currency between TS (support) and KS (resistance and the target of present rise). But herewith, the majority of IKH-patterns: a disposition of the price below Cumo, and ChS below the price chart, "a deadly cross" and future Down Cumo speak about kept of strength of a Bearish trend. Decline of the price under decreasing fast trend line TS will give a pattern to trend renewal.
GBPUSD
On Wednesday and today's Asian session a rate of the British pound rise, having got to by present time the Cumo's upper boundary SSA that means continuation of flat dynamics between support SSB and resistance SSA. Horizontality of trend lines TS and KS and interlacing of ChS with the price chart also speaks about consolidations of the British currency, but disposition of TS below KS and future Down Cumo testify to probability of fall of a rate. The pullback of the price from SSA, will confirm stability of flat, but the decidedly breakout of resistance upside, will point to end of flat.
USDJPY
The Japanese Yen on Wednesday and today's Asian session steadily fell, breakout support on TS downside by present time. It means the beginning of descending correction of a rate with the target of falling on the basic trend line KS. Horizontality of trend lines TS and KS speaks about continuation of consolidation, but a disposition of the price above Up Cumo, and ChS above the price chart and "a golden cross" testifies to an opportunity of renewal of an Bullish trend. A pattern to this will be upsurge of fast trend lines TS, under condition of rise of the price above it.
USDCAD
On Wednesday the Canadian dollar fell, breakout support on close lines KS and SSB downside, and entranced within the Cumo, having continued decline and in today's Asian trading session. The entrance of the price to Cumo, means a final failure of attempts to begin an up trend and start the flat dynamics between support on SSA and resistance on SSB. Herewith the horizontality of trend lines TS and KS and interlacing ChS with the price chart also speak about consolidations of a rate, but "a golden cross" and future Up Cumo, still point to kept of probability of renewal of rise.
AUDUSD
The Australian dollar on Wednesday rose in price, decidedly left Cumo and has continued steady rise in today's Asian session. It forms premises for the beginning of an up trend: rise of a rate above Cumo, and ChS above the price chart and "a golden cross" forecast an entrance of a rate in a Bullish trend, but future Down Cumo, still points to an opportunity of fall. Rise of SSA above SSB in the future and formation of "a three-line pattern" will finally confirm begin of the Bullish trend of the Australian currency, and now the support is Cumo's upper boundary SSB.
NZDUSD
On Wednesday the New Zealand dollar continued the falling and entranced within the Cumo, and in today's Asian session it again has risen in price, but has not managed to leave Cumo. This means end of an up trend and begin of flat dynamics between support on SSB and resistance on SSA. Horizontality of trend lines TS and KS, and vicinity of ChS to the price chart, also speak about consolidations, but wide Up Cumo and disposition of TS above KS still testify to an opportunity of new rise.
GBPCHF
Cross-rate of the British pound to the Swiss franc on Wednesday and today's Asian session weak oscillated, continuing of a Bullish trend about which presence now speak all IKH-patterns: a disposition of a rate above wide Up Cumo, and ChS above the price chart, "a golden cross" and "a three-line pattern". The rate of the British pound to US dollar now has flat dynamics, and the Swiss franc also was consolidated, that points to probability of consolidation of cross-country-rate of these currencies.
On Wednesday the US dollar has started to hand over its positions to the major currencies. The rates to the Swiss franc and the Japanese Yen begin the descending correction, and not having managed to renew the up trends, and Canadian dollar begin flat dynamics. Euro also has renewed ascending correction, the British pound is in flat, and its cross-country-rate to the Swiss franc continues a long-term Bullish trend. The Australian dollar has finished flat and tries to begin an up trend, and the New Zealand dollar, on the contrary, begun the flat dynamics, having finished a Bullish trend.
27.10.2006
USDCHF
On Thursday the Swiss franc sharply fell, almost got to support on the basic trend line KS, and in today's Asian session its falling has proceeded. It means renewal of descending correction of the currency, and in case of breakout of KS by the rate downside further falling down to the Cumo's upper boundary is possible. But many IKH-patterns: a disposition of a rate above Cumo, TS above KS, and ChS above the price chart, and future Up Cumo speak about a kept of opportunity of renewal of rise. The rebound of the price from KS upside, will confirm it.
EURUSD
The rate of euro on Thursday sharply rose, breakout the resistance on KS upside and almost got to the Cumo's bottom boundary SSB, and in today's Asian session its rise has proceeded. It means deep ascending correction of a rate of the European currency which in case of breakout of resistance SSB upside will begin flat. Interlacing of ChS with the price chart speaks about balance of the market, but disposition TS below KS and future Down Cumo point to a kept of opportunity of fall. Therefore the pullback of the price from SSB downside will form premises for renewal of a Bearish trend.
GBPUSD
On Thursday the rate of the British pound left from Cumo upside and essentially rose, having continued the rise and in today's Asian session. Mount of a rate above Cumo forms the first pattern to the beginning of a Bullish trend and herewith strength of Bearish IKH-patterns decreases: ChS it is interlaced with the price chart that points to consolidation, TS upsurge and approaches with KS, and thickness of future Down Cumo decreases. It makes a situation with the British currency ambiguity.
USDJPY
The Japanese Yen on Thursday fell, and breakout the support on fast trend line TS downside and the beginnings of descending correction with the target of decline on the basic trend line KS, but in today's Asian trading session it has a little rise. Herewith the majority of IKH-patterns: a disposition of the price above Up Cumo, TS above KS, and ChS above the price chart testify to an opportunity of renewal of a Bullish trend. A pattern to this will be rebound of the price from KS upside with the subsequent rise above upsurge fast trend line TS, however also consolidation of a rate between trend lines also is possible.
USDCAD
On Thursday the Canadian dollar a little fell after intensive oscillations, and formed a candlestick "a black shooting star" with very long top shadow, points to the Bearish market, and in today's Asian trading session the rate oscillated at one level. The entrance of the price of the Canadian currency within the Cumo means final end of attempts to begin of a Bullish trend and begin the flat dynamics between support on SSA and resistance on SSB. Herewith the horizontality of trend lines TS and KS and interlacing of ChS with the price chart also testify about consolidations of a rate, but "a golden cross" and future Up Cumo, still point to kept probability of renewal of rise.
AUDUSD
The Australian dollar on Thursday continued to rise in price steadily, and in today's Asian session its rate has oscillated at one level. Now the majority of IKH-patterns: mount of a rate above Cumo, and ChS above the price chart and "a golden cross" speak about the beginning of a Bullish trend on the Australian currency, but future Cumo is still Down though its thickness decreases. Mount of SSA above SSB and formation of "a three-line pattern" will give a final confirmation of stability of the new up trend. The nearest support now is TS.
NZDUSD
On Thursday the rate of the New Zealand dollar rose, got to the resistance on SSA, and today's Asian session it has continued the rise and has left Como. If on results of the today's trades, price it will be possible to be mount above SSA, it will give a pattern about renewal of a Bullish trend as wide Up Cumo and disposition of TS above KS points to this opportunity. But interlacing of ChS with the price chart testifies about consolidations and return of a rate to within the Cumo will confirm continuation of flat dynamics of the New Zealand currency between its boundary.
GBPCHF
Cross- rate of the British pound to the Swiss franc on Thursday and today's Asian session fall and has got to of support on fast trend line TS by present time. The rebound of the price from it upside will confirm continuation of a long-term up trend to which all IKH-patterns testify: a disposition of a rate above wide Up Cumo, and ChS above the price chart, "a golden cross" and "three-line pattern". Breakout of TS downside will mean the beginning of descending correction with the target of falling on KS. The rate of the British pound to US dollar now has not certain dynamics, trying to begin an up trend, and the Swiss franc fall in descending correction that points to probability of consolidation of cross-country-rate of these currencies.
On Thursday the US dollar has accelerated the falling to major currencies, begun on the eve. The rates of the Swiss franc and the Japanese Yen continue descending correction, and the Canadian dollars has begun flat dynamics. Euro has finished ascending correction and tries to enter in flat, and British has finished flat and makes attempts to begin an up trend, but its cross-rate to the Swiss franc while continues a long-term Bullish trend, despite of some fall. The Australian dollar begin a Bullish trend, and the New Zealand dollar, tries to end the flat and to renew an up trend.
28.10.2006
USDCHF
On Friday the Swiss franc breakout the support on the basic trend line KS downside and continued fast falling. It means an entrance of the price in deep descending correction with the target of falling on next support SSA. While the rate is above Cumo, TS above KS, and future Cumo remains Up, the opportunity for renewal of a Bullish trend is still kept, but interlacing of ChS with the price chart speaks about market consolidation.
EURUSD
The rate of euro on Friday continued the steady rise and entered into Cumo that means begin of flat dynamics between support on SSB and resistance on SSA. Interlacing of ChS with the price chart also points to consolidation of a rate, but future Down Cumo and disposition of TS below KS still testify to an opportunity of renewal of falling of the European currency.
GBPUSD
On Friday the British pound again rose in price, and confirmed begin of a Bullish trend by formation of "a golden cross". But present the ChS it is interlaced with the price chart, and SSA now touched SSB, that testifies consolidation is not finish yet. Therefore for confirmation of the beginning of an up trend it is necessary to wait rise of ChS above price chart, and appear the future Up Cumo. Support now is SSA.
USDJPY
The Japanese Yen on Friday accelerated the falling and breakout the support on the basic trend line KS downside, almost tested by the bottom shadow the next support on SSA. It means the beginning of deep descending correction of a rate which can come to the end or a rebound from the "cloud" upside, renewing an ascending trend, or an entrance of price into the Cumo, speaking about flat. Preservation of the price above wide Up Cumo, ChS above the price chart, and TS above KS testifies to greater probability of new rise of a rate.
USDCAD
On Thursday the Canadian dollar continued the falling within the Cumo, declined down to its bottom boundary SSB. The rebound of the price from it upside will point to continuation of flat dynamics between support SSB and resistance SSA, but breakout of SSB downside will form the first premises for begin a down trend. Herewith interlacing of ChS with the price chart also speaks about consolidations of a rate and disposition TS above KS and future Up Cumo point to an opportunity of rise of a rate.
AUDUSD
The Australian dollar on Friday accelerated the fall proceeding here already the fourth day successively. Now almost all IKH-patterns (rise of a rate above Cumo, and ChS above the price chart, "a golden cross" and future Up Cumo) testify to the beginning a Bullish trend on the Australian currency. Formation of "a three-line pattern" will confirm stability of trend rise, and the nearest support now is TS.
NZDUSD
On Friday the rate of the New Zealand dollar fell again, finally left from Up Cumo and having breakout the both trend lines upside. It, alongside with "a three-line pattern", forms premises for renewal a Bullish trend, but horizontality of TS and KS and vicinity of ChS with the price chart speaks that consolidation still is not finished. Rise of support TS and mount of ChS above the price chart will be final patterns to renewal a Bullish trend.
GBPCHF
Cross-rate of the British pound to the Swiss franc on Friday continued slow fell and got to the support on fast trend line TS. The rebound of cross-country from it upside, will confirm strength of a long-term up trend which point to all IKH-patterns (a disposition of a rate above wide Up Cumo, and ChS above the price chart, "a golden cross" and "a three-line pattern"). At the other hand, breakout of TS downside will mean the beginning of descending correction with the target of falling on KS. Now the price was consolidated at top of an up trend to what horizontality of trend lines TS and KS testifies. A rate of the British pound to US dollar now begins an up trend, and Swiss franc declines in deep descending correction that points to probability of consolidation of cross-country-rate of these currencies.
On Friday the US dollar continued the falling to the major currencies. The Swiss franc and the Japanese Yen started the deep descending correction, and the Canadian dollar has flat dynamics. Euro also began the flat, and the British pound tried to begin an up trend, herewith its cross-rate to the Swiss franc was consolidated at top of a Bullish trend. The Australian dollar began a Bullish trend, and the New Zealand dollar, ended of flat and tries to renew an up ascending trend too.
Ichimoku Kinko Hyo is Japanese for "one glance cloud chart." It consists of five lines called Tenkan-sen, Kijun-sen (sen is Japanese for line), Senkou Span A, Senkou Span B and Chinkou Span. The calculation uses four different time periods which we call termT, termK, termS and termC. The Ichimoku Kinko Hyo is graphed over the closing price line. The space between the Senkou spans is called the Cloud, and is usually graphed in a hatched pattern.
The Senkou Spans are support and resistance lines. When the price is in the Cloud, the market is non-trending. When the price is above the Cloud, the higher Span is the first support level and the lower Span is the second support level. When the price is below the Cloud, the lower Span is the first resistance level and the higher Span is the second resistance level.
Kijun-sen and Tenkan-sen are trend indicators. When the price is above the Kijun-sen, prices will likely continue to go up, when the price is below the Kijun-sen, prices will likely continue to go down. The direction of the Tenkan-sen indicates the direction of the trend. If the Tenkan-sen is flat, the market is in a non-trending channel.
The Ichimoku Kinko Hyo Japanese charting technique was developed before World War II with the aim of portraying - in a snapshot - where the price was heading and when was the right time to enter or exit the market. This was all performed without the aid of any other technical analysis technique (or study).
The word Ichimoku can be translated to mean "a glance" or "one look". Kinko translates into "equilibrium" or "balance", with respect to price and time, and Hyo is the Japanese word for "chart". Thus, Ichimoku Kinko Hyo simply means "a glance at an equilibrium chart", providing a panoramic view of where prices are likely to go and the position one should undertake.
Invented by a Japanese journalist with a pen name of "Ichimoku Sanjin", meaning "a glance of a mountain man", Ichimoku charts have become a popular trading tool in Japan, not only with the equity market, but in the currency, bond, futures, commodity and options markets as well. The technique was published over 30 years ago but has only gained international attention within the last few years.
The Ichimoku chart consists of five lines. The calculation for four of these lines involves taking only the midpoints of previous highs and lows, similar to moving average studies. Yet even with this simplicity, the completed chart is able to present a clear perspective of the price action.
Ichimoku uses three key time periods for its input parameters: 9, 26, and 52. When Ichimoku was created back in the 1930s, a trading week was 6 days long. These parameters, thus, represent one and a half week, one month, and two months, respectively. Now that the trading week is 5 days, one may want to modify the parameters to 7, 22, and 44.
Moreover, there are, in fact, different levels of strengths for the buy and sell signals of an Ichimoku chart. First, if there was a bullish crossover signal and the price, at that time, was trading above the Kumo (or cloud), this would be considered a very strong buy signal. In contrast, if there was a bearish crossover signal and the price, at that time, was trading below the Kumo, this would be considered a very strong sell signal. Secondly, a normal buy or sell signal would be issued if the price was trading within the Kumo when the crossover took place. Thirdly, a weak buy signal would be issued if there was a bullish crossover that occurred while the price was trading below the Kumo. On the other hand, a weak signal would be issued if there was a bearish crossover that occurred when the price was trading above the Kumo.
Another striking feature of the Ichimoku charting technique is the identification of support and resistance levels. These levels can be predicted by the presence of the Kumo. The Kumo can also be used to help identify the prevailing trend of the market. If the price is above the Kumo, the prevailing trend is said to be up. And if the price is below the Kumo, the prevailing trend is said to be down.
A final feature of Ichimoku is the Chikou Span. This line can also be used to determine the strength of the buy or sell signal. If the Chikou Span was below the closing price and a sell signal was issued, then the strength is with the sellers, otherwise it is a weak signal. Conversely, if there was a buy signal and the Chikou Span was above the price, then there is strength to the upside, otherwise it can be considered a weak buy signal. This feature can also be incorporated into the other signals.
Chinkou Span shows the closing price of the current candle shifted backwards by the value of the second time interval. The distance between the Senkou lines is hatched with another color and called 'cloud'. If the price is between these lines, the market should be considered as non-trend, and then the cloud margins form the support and opposition levels. If the price is above the cloud, its upper line forms the first support level, and the second line forms the second support level. If the price is below cloud, the lower line forms the first opposition level, and the upper one forms the second level. If the "Chinkou Span" line traverses the price chart in the bottom-up direction it is signal to buy. If the "Chinkou Span" line traverses the price chart in the top-down direction it is signal to sell. "Kijun-sen" is used as an indicator of the market movement. If the price is higher than this indicator, the prices will probably continue to increase. When the price traverses this line the further trend changing is possible.
Another kind of using the "Kijun-sen" is giving signals. Signal to buy is generated when the "Tenkan-sen" line traverses the "Kijun-sen" in the bottom-up direction. Top-down direction is the signal to sell. "Tenkan-sen" is used as an indicator of the market trend. If this line increases or decreases, the trend exists. When it goes horizontally, it means that the market has come into the channel.
Most traditional technical analysis techniques are based on the open, high, low, close or average price. Others may use volatility while fixed scales such as Fibonacci numbers have also been applied. But the results are the same. Support and resistance levels are always depicted as a point or a line.