• Ichimoku is the abbreviation of the Ichimoku Kinko Hyo system of a Japanese journalist named Goichi Hosoda. Recently known to many people for its 5-line indicator system, these 5 indicators can be basically said to be essentially similar to the moving average of the West (MA), taking three averages. 9,17,26.
  • The first thing I want to share with Ichimoku is the basics of this system that you may not be aware of!
  • First, the Ichimoku system is a system that analyzes both axes of the price line, which are the x and y-axis.
  • Secondly, the Ichimoku system not only has an indicator system, but also adds 3 very important theories, namely, price target theory (y-axis analysis), time theory (x-axis analysis), and wave theory.
  • Third, the Ichimoku indicator system, which is a simplification of the three theories above, is formed from a 9-candle volatility cycle.

  • In part 1, in the introduction, I said Ichimoku is a system that analyzes both x and y axes. So how is it in this part I will clarify.
  • As you know, the graph that you analyze every day, and on the deviation has two axes that are the price axis and the time axis that is the two axes x and y that you learned in level 2. 3. But are you (wise) enough to see? often blinded by greed.
  • In analysis and trading, you only pay attention to the price line, or most trading systems only focus on the price line, this is what I want to talk about here. In the book "technical analysis of financial markets" author John J. Murphy also wrote:
  • "Look at the standard daily bar graph. The vertical bar is the price bar. But that's only 50 % of the data needed. The horizontal column is time. So the bar graph is really a price graph and However, many traders only focus on price data and forget about time. "
  • In Ichimoku system is formed from 2 main theories: price target theory and price volatility cycle theory. The price target theory, if the user Ichimoku uses can see that the price level of this theory is almost corresponding to the Fibonacci retracement, the y-axis then many of you are familiar so I will not say much. I only focus on the x-axis (price volatility cycle). Time theory, better known today as the theory of price volatility cycles. Before diving into Ichimoku's time theory, please read the following excerpt of Eastern trading decoding book about cycle as follows:
  • "In science, philosophy, life, and nature from the West and the East, there are motivational philosophies or principles in many different fields, from mathematics, biology, physics, ... to divination algorithms, the five elements, and philosophies in many different religions such as Buddhism, Hinduism, Shintoism, Taoism ... All have mentioned more or fewer laws good motion is now well known for its innovations and is clearly represented in the term movement cycle The period of time between two successive repetitions of an event, or the time to end This concept of periodicity is analyzed and explained very clearly such as wave movements (physics), trigonometric equation waves (mathematics), circadian rhythms (biology), ... Cycle in science in general and in financial transactions, in particular, is determined by the following three factors: Amplitude, time, phase, and there are 4 main principles, the cumulative principle, the harmonic principle. draw, danger The principle of the same time, the principle of balance. The above basic elements and principles are all constituting the harmonic sine wave motion. "
  • According to the above theory, in cycle analysis is divided into 3 basic factors: amplitude, time, and lag. 
+ Amplitude is the height of the wave.

+ Time is the distance of two bottoms or peaks in a wave cycle.

+ Phase is the top or bottom of an oscillating wave (it can also be the bottom of the price line). Several different cycles (homogeneity) may appear in the same phase. These wave cycles allow the analyst to make more accurate judgment during the trade.

  • Practice:

  • You can basically see that the price line tends to move in sine wave amplitude
  • Returning to Ichimoku, if you notice the future clouds formed by Span A, B, you can see that the clouds also tend to form like sine waves.

  • If you pay attention to span A, you can see that the moving direction of the sine wave and span A is similar to each other from the bottom peak and moving waves.
  • If that is the case, we can conclude that Ichimoku's time theory is similar to western period theory. But the difference is that Ichimoku focuses on the cycle of movement of 9 (9,17,26, almost equal to 9 + 9 + 9) so the indicator of Ichimoku is only true when the cycle of movement of the line The price is 9.
  • Next is the time theory part of Ichimoku, now there are quite a few books or documents written about this part. This part is quite long so I will share next. But there is a time theory part in general or all three advanced theories of association Ichimoku in particular, the analysis of combining both axes, in which time theory analyzes different types of cycles, Different numbers, not just focusing on the three main numbers are 9,17,26. wave part and price target segmentation, analyzing sine wave motion patterns such as I V N.
  • In my experience, Ichimoku system is a system worth learning and learning because it has both basic elements of technical analysis required, which are x-axis analysis and analysis. y-axis, but this also means that it is difficult to absorb and apply this system proficiently.
  • In the previous part, I have introduced to you that Ichimoku is a system that can analyze both X and Y axis, And in this next part I will talk about Ichimoku system in Y-axis analysis first.
  • Before going into your own part, let me share some of the following points:
  • First, the Ichimoku system is a philosophical (Eastern) system. Ichimoku comes from Japan, so in the system, there exist the philosophies of Shinto (the main religion of the Japanese) and Buddhism (if you know Japanese, you can learn in Sasaki's Ichimoku. can know). In my article on Ichimoku is completely based on the original philosophy of the system and I don't add anything sublime here. As far as I know, the indicator Ichimoku is developed based on the law of cause and effect and does not have any elements of the eight trigrams. The above law of cause and effect can always be applied in practice with this Ichimoku part that I share in this part 3.
  • Second, If you are looking for a system that makes money, please don't read your articles. I hope you to distinguish clearly the two terms ANALYSIS SYSTEM and TRADING SYSTEM. The analysis system is only analyzing the price line to give you a clearer view in the future, the price goes up or down, but there is not necessarily a money going factor here, and the TRADING SYSTEM is a lift. more level of analysis system by adding methods of capital management, discipline, ... to minimize risk in trading. My series of articles is the dissection analysis of Ichimoku analysis system for you to understand the whole system and evaluate for yourself whether this system is suitable for you or not, and for you guys. determine whether the Ichimoku system is the holy grail !.
  • Third, my articles have both theory and practice. So you don't have to worry about writing only philosophies and theories. I simply cannot meet the needs of each person, there are things that are not helpful to you but very helpful to Others and I will write in full you who do not like philosophy or theory and feel unrealistic, just ignore it.

  • Part 3 of this I will talk about the indicator of Ichimoku. In this section, I will divide into 2 main sections: 
+ y-axis analysis with ichi indicator 
x-axis analysis with ichi indicator.
As I mentioned briefly in the sharing of views above, the Ichimoku system in general and the Ichimoku indicator system, in particular, are formed from the two philosophical foundations of Shinto and Buddhism. In which the main philosophy of the system is the Law of Cause and Effect.

+ In cause and effect, I can divide into three parts as follows: past, present, future, and lying on a time axis. The present is a milestone that changes according to things, events, or any phenomenon, the past is the time calculated from the present time to the polar, the future is calculated from the present time. To + infinity. In the law of cause and effect, things, events or anything happening in the past are the causes of future results, so future results depend on the "causes". In the past and future "effects" you can predict if you are qualified enough to understand the nature of past "causes". What makes the future change is that actions or things, events, phenomena in the present will plus the "causes" already in the past to create a picture in the future.
+ For technical analysis in general and in Ichimoku in particular, there always exist these three factors. In the price line, it can be said that the present time is calculated by the fluctuating candles, and the past is the candle that is closed, the future is what you predict and looks on the past like trend, candlestick pattern, SD, ...
+ In Ichimoku, these three elements are further specified with indicator lines. The vast majority of other methods of analysis have to analyze the futures themselves, but for Ichimoku, author Hosoda partly helps the analyst stick to the future of the price line. In the indicator system of Ichimoku represents the past as chicken-span, past in ichi fully exists 5 indicators and 2 main factors are Kumo and price line. Currently, in the Ichimoku the main representative is Tenkan-sen, the current Kijun-sen does not have the full remaining chicken-span indicator. The future in Ichimoku represents the Senkou span AB and forms the Kumo.
I. Tenkan and kijun
  • Tenkan-sen and kijun-sen are similar to MA
  • Tenkan-sen and kijun-sen in structure and formation are similar to MAs and are similar in roles to MAs.
1. Intersection of Tenkan-sen and Kijun-sen: Tenkan-sen is composed of 9-candle average, Similar to MA 9, Kijun-sen is composed of the coincidence of 26 candles, similar to MA 26 Therefore, when moving tenkan-sen, it moves closer to the price line than Kijun-sen, and when the price reverses strongly, it causes tenkan-sen to cut through kijun-sen, this is the first sign.

H1: Tenkan cut kijun up

  • Tenkan-sen cuts Kijun-sen up, calculating the price signal to go up.
H2: Tenkan-sen cuts Kijun-sen down.

2. Tenkan- kijun created resistance and support in the market with similar trend as MA 9 and 26
3. Sustainable trend of tenkan- kijun:
  • The trend formation of 9 and 26:
+ The trend here is the sustainable trend, so what is the sustainable trend, the sustainable trend I mention here is the up or downtrend that the price follows. tenkan, kijun, or MA, EMA, SMA (9.26) in a long-term trend within a certain time frame. The sesame trend in gann is the 1x angle, in theory the main trend is an uptrend or a downward trend at a 45-degree angle, to see more clearly invite you to see the following examples:
  • For example, Ichimoku:
H1.1: XAU / USD M30 (ichimoku)

  • In terms of Ichimoku, the sustainable trend is when the price line follows Tenkan and Kijun. At kijun we cannot see the long equilibrium of kijun, it can almost be said that there are not any strong ports for which price can be adjusted. Therefore, the price will continue its trend.
  • For example EMA:
H1.2: XAU / USD m30 (EMA)

  • In terms of EMA, a sustainable up (down) trend will follow 2 EMA 9 and 26, in which 26 EMA represents a support correction and EMA 9 shows a trend to follow.
  • Example gann: 

H1.3: XAU / USD M30 (Gann box)

H1.4 gann boxx combined with gann fan: For gann, the solid side trend is the one that runs at 45 degrees, which is 1/1 trend (the average trend of the price line)

  • For example, if you throw a stone that wants it to fly the furthest, you must throw it at a 45-degree angle similar to the price line. If the price line wants to move the furthest, you must move a 45-degree angle, which is a 1/1 angle in the gann fan. , or follow the trend of MA 9, 26. Tenkan, kijun and the difference for MA.
  • The structure and fundamental difference of Tenkan-kijun and MA are the different formulas. tenkan kijun takes the highest and lowest points of 9 and 26 candles that form tenkan and kijun.
1. The reaction of the price line when kijun-tenkan creates a flat:
The first difference in the MA and tenkan kijun everyone can recognize is the flattening.
+ Tenkan creates flat, forming price points where the price line trends to correct small waves (within a fixed time frame) towards the flat tenkan, prices with flat tenkan are usually equivalent to Fibonacci retracement 23.6% to 50% depending on the strong and weak trend of the price line.
+ Kijun flattening forms price lines where the price line tends to correct large waves (within a fixed time frame) towards the prices that the kijun flattens, those with flattened kijun are usually equivalent to Fibonacci retracement 50% to 78.6% depending on the strong and weak trend of the price line.

  • In particular, we can predict when the price line is about to correct based on tenkan and kijun as these two lines also form flat at the same time, which I call it a price line equilibrium.

  • These ranges are the equilibrium or self-equilibrium of the price line.
2. The reaction of the price line to the crossover of tenkan and kijun.
As in the western part, it was said that a crossover of MA or a crossover of Tenkan and kijun is the forecast of a reversal, but the difference here is that after the cross of tenkan and kijun, the kijun line after the cross. will form a flat at a price where the price line has a high probability of pulling back to this level before moving in on a new trend.

II. Chikou-span and price line:

1. Chikou-span and supportive resistance:
About the structure of a chikou-span is a line formed from the closing price of the price line back to 26 candles, because this chikou helps us to see a more standard support resistance area for analysis.

2. Cross between chikou and price line:
In the bottom market, when the chikou-span crosses the price line, it is a reversal confirmation or a strong correction.

  • Items 1 and 2 are the two most basic views about chikou, but these two are the two basic things that most people know through western ichi books. Only one last thing that is not mentioned in any document is the relevance of Chikou-span and time theory that is the pivotal point of Chikou-span or the past of ichimoku. (I will cover all of this after incorporating time theory).
  • CHIKOU-SPAN is less important but indispensable.
III. Senkou span AB and price line:
  • Senkou span A is calculated from the average price of tenkan and kijun and divided by 2, moving to 26 forming candles.
  • Senkou span B is calculated from the average price of the highs of 52 candles from the current candle divided by 2 and moved to the 26 formed candles.
  • The middle part is Kumo.

1. Senkou-span AB:
  • The Senkou span AB is moving averages from the current price to 26 candles, and have the same effects as the moving averages used for better trend recognition, thanks to the Senkou span AB and cloud colors, used as better support resistance levels, ... This is of course not wrong but does not specify all the necessary effects of future fertilizers in Ichimoku. To understand everything I will try to write fully.
2. Kumo: translated into Vietnamese means cloud.
  • The cloud in Ichimoku is the psychology of the market or the psychology of the crowd. You can imagine dark clouds and white clouds in the sky thick dark clouds that make it difficult to penetrate sunlight, thin white clouds where sunlight can penetrate more easily, and clear clouds. Ichimoku is similar, thick clouds prove that market sentiment, as well as crowd sentiment, is very strong and stable, hard to shake and break.
  • On the contrary, a thin cloud shows a weak mentality so it is very easy to change and break.

3. Senkou-span B flat:
  • Senkou-span B is composed of the average of the highest and lowest point of the price line after 52 candles. This is also the area where the price line corrects strongly in this area. The flat Senkou-span B is often called the flat cloud area to absorb the price.
  • For example 1: currency pair AUD / USD chart D1.
  • When the price is at point A, the Senkou-span B has begun to flatten, this flat Senkou-span B is the flat cloud, you can see from point B the price line starts to move up strongly to reach the Senkou area. -span B is flat and reacts.
  • Flat areas of clouds in the past (located in front of the price line) when the current price can still react.
  • For example 2: AUD / USD D1 currency pair 
  • Looking at the example above you can see that after the price corrected towards the flat cloud (point 2) and broke through the thin cloud, the price reacted to the previously flat cloud at point 1. So the Senkou-span This flat B helps us see very good resistance and support points and, importantly, helps us to filter out support resistance points that price lines are more likely to react to.
4. Senkou-span AB intersection and response to the price line:
  • Similar to the intersection of tenkan and kijun lines, but the difference is that the price line reverses and continues a few candles and then tenkan and kijun begin to cross (similar to MA). At Senkou-span AB it is possible to cross before or during the price line reversal faster than the cross of tenkan and kijun.
  • Example: currency pair AUD / USD H4

  • When the price was at point A, the Senkou-span AB crossover was occurring point B, and in the next 3 candles from point A the price line reversed upwards.
  • NOTE: not always when a Senkou-span AB cross will result in the price line reversing. In the next section, I will talk more about the combination of indicators and time theory and will combine these 2 parts to form a complete part of the indicator and there will be practical analysis, examples, after...
  • Regarding the philosophy of cause and effect, the latter part will also be more clear because the future present past is a system that is parallel or coincident with the time axis, so the following section can be easier to understand and apply.
  • Previous article I wrote about ichimoku indicator with y-axis, today I will continue writing this series on ichimoku indicator with x-axis. Hopefully, through these two articles about Ichimoku part 3, you can better understand ichimoku and better use the ichimoku tool to analyze the charts.
  • ICHIMOKU indicator and x-axis
1. Tenkan, kijun and price line.
  • As you know through the documents or through ichimoku articles in general, tenkan and kijun are similar to MAs, but what I want to say here is the number that tenkan, kijun uses is 9 for tenkan, 26 for kijun. Through the analysis and trading process, I can confirm that these two numbers are the cycle of the price line (through the top and bottom) according to the calculations and statistics of Mr. Hosoda who created and wrote. .
  • So if you apply these 2 numbers to MA, can you get the same results. The answer is yes, but it doesn't seem as upright and ineffective as tenkan and kijun.
  • NOTE: can deviate from 1 to 2 candles
  • If you replace the numbers 9 and 26 it still works. But in my opinion you should leave it as is because in my experience period 26 happens quite a lot can be said to be the most out of all the other numbers, 9 is a small period of 26 flat formation and kijun prediction, tenkan and flat formation
2. Chikou and sugar price
  • It can be said that chikou is the past in ichimoku or the shadow of the price line, the shadow of the future.

3. Span AB and price line
  • Span AB moves to 26 candles and is often seen as the future of the price line. If the above sentence makes you a little suspicious, that's fine !!! Because seeing the future of the price line, then everyone who uses ichi will become a billionaire. If you have such thoughts, you may have deviated from this system.
  • Point of folding
  • The fold at Senkou-span B: the fold is the lowest highs of the candle that broke past supportive resistance, forming a fold at Senkou-span B.

4. Coordinate indicators:
  • Normally, this trading method is usually used with the top of the bottom of the price line, and in other cases it is necessary to use an additional factor, kumo for analysis.
  • Now try to combine the three items above if the price line is at the top or bottom. Or you have predicted the top, the bottom.
+ B1: determine, predict kijun and flat tenkan
+ B2: identify the past top-bottom area closest to the chikou, use the tool ... to pull up to 26 candles and predict the top-bottom and move trend with the chikou ...
+ B3: determines the folding point and the future wave
+ B4: improvised with a fallback scenario when it goes against the above. (This part is difficult to say in an article, if I have time I will make a video to analyze specifically for you)
  • Note that the low peaks can deviate from 1 to 2 candles.
+ The weakness of the current method is the lack of barriers (resistance, support) to support the wrong entry point. Therefore, it is necessary to combine the components first to create a more standard system.