I stumbled on it just at the beginning, but at that time I was mainly looking at 1 and 5 mins. charts and it seemed not good at all.
After reading some article (http://www.ibtimes.com/articles/20090825/ichimoku-trendsystem-indicator.htm ), I have carelessly attached this indicator to GBPUSD M15 chart which was on top at the moment.
I was amazed!
It looks great as an addition to a SMA (Simple Moving Average) 100 and SMA200 on M5 chart.
What I like about it, is that it's agreeing most of the time with the moving averages. You may think - so what's the point of using it?
The point is - if you have confirmation of the trend from more then one indicator/method the more confident you are.
As master Yoda said: “Fear is the path to the dark side. Fear leads to anger. Anger leads to hate. Hate leads to suffering.”
More confirmations = less fear .
Less fear = more profit :-)
Some technicals:
There are different flavors of Ichimoku:
In one version Tenkan and Kijun lines are moving averages (shifted horizontally) - like they explain on:
http://www.fxwords.com/u/ichimoku-cloud.html
Other version - like the one given with MT4 (MetaTrader 4) trading application is using:
"1. The Tenkan Sen - Calculated as the sum of the highest high and the lowest low divided by two. The Tenkan is calculated over the previous seven to eight time periods.
2. The Kijun Sen - Calculated as the sum of the highest high and the lowest low divided by two. Although the calculation is similar, the Kijun takes the past 22 time periods into account."
There is also a mutation available on mql4.com:
What is the most important about usage:
Default (9/26/52) settings work on GBPUSD M15 nicely, but generally you have to experiment with different settings (and on a demo account if you will ;-) for other pairs and time frames.
Good luck and may the force be with you !
P.S. 180 Pips last night (Sydney and Tokio sessions), using MA100/200 and Ichimoku on M5 and M15 GBPUSD :-)
To be continued....
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