Ichimoku Charting and Analysis
bullish and bearish Ichimoku Indications
Among the five Ichimoku overlays, both the cloud and Chikou Span are consid-
ered the most important indicators of sentiment. Here are some bullish indications
or signals found on Ichimoku charts.
Price is considered bullish if it is:■ (^) above the Tenkan‐sen,
■ (^) above the Kijun‐sen,
■ (^) above the cloud, or
■ (^) rising at a bullish angle.
The market is also considered bullish if:
■ (^) Tenkan‐sen crosses above the Kijun‐sen,
■ (^) Tenkan‐sen and the Kijun‐sen cross above the cloud,
■ (^) Chikou Span is retroactively above price,
■ (^) Chikou Span is retroactively above the Tenkan‐sen, Kijun‐sen, or cloud,
■ (^) Tenkan‐sen and the Kijun‐sen are rising at a bullish angle,
■ (^) the cloud is rising at a bullish angle, or
■ (^) the cloud is thick when price is above it.
For bearish indications, price is considered bearish if it is:
■ (^) below the Tenkan‐sen,
■ (^) below the Kijun‐sen,
■ (^) below the cloud, or
■ (^) is declining at a bearish angle.
The market is also considered bearish if:
■ (^) Tenkan‐sen crosses below the Kijun‐sen,
■ (^) Tenkan‐sen and the Kijun‐sen cross below the cloud,
■ (^) Chikou Span is retroactively below price,
■ (^) Chikou Span is retroactively below the Tenkan‐sen, Kijun‐sen, or cloud,
■ (^) Tenkan‐sen and the Kijun‐sen are declining at a bearish angle,
■ (^) The cloud is declining at a bearish angle, or
■ (^) The cloud is thick when price is below it.
Only in a strong uptrend will all five Ichimoku overlays be in agreement with
each other on whether the market is bullish or bearish. Most of the time, some
signals will conflict with others. When that happens, the market is usually in or
about to go into, ranging mode.
The Japanese candlesticks play an important role in revealing the current sen-
timent in the market. The candlestick formation that unfolds at support and re-
sistance is often a significant factor in forecasting price action. The candlestick
behavior within the clouds is also an important clue as to the potential direction
of price breakout.