Ichimoku trading strategy with the Senkou Span (Part 7)

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Ichimoku trading strategy with the Senkou Span (Part 7)
Ichimoku trading strategy with the Senkou Span (Part 7)

After going through 6 parts of learning about Ichimoku, how do you feel? It’s also not that difficult once you understand the process to create a trading strategy that suits your personality. Today I will continue to introduce to you a simple but highly effective trading strategy in the Ichimoku system that few people know about.

Ichimoku trading strategy with the Senkou Span

This is considered a less common strategy in the Ichimoku system. It is often used for confirmation with other methods rather than used alone. But through testing, I find it helps me to earn stable profits. So I want to share it with you.

The way to enter the order is also very simple:

BUY when Senkou Span A (green) cuts Senkou Span B (orange) from below.

SELL when Senkou Span A (green) cuts Senkou Span B (orange) from above.

A special point to remember is that this signal occurs sooner than the price with 26 periods forward.

So we divide it into 3 types: strong, medium, weak. However, we only show you strong and medium signals for safe trading. Weak signals are not recommended to place orders because it is not clear.

Senkou Span A cuts Senkou Span B from below at B. The price is currently at A and above the Kumo cloud, which is a strong Buy signal.

Strong BUY signal when Senkou Span A cuts Senkou Span B
Strong BUY signal when Senkou Span A cuts Senkou Span B

Senkou Span A cuts Senkou Span B from above at D. The price is currently at C and below the Kumo cloud, which is a strong Sell signal.

Strong SELL signal with the Senkou Span
Strong SELL signal with the Senkou Span

The Senkou Span A cuts the Senkou Span B from below at F. The price is currently at E and inside the Kumo cloud, which is an average Buy signal.

Average BUY signal with the Senkou Span
Average BUY signal with the Senkou Span

Senkou Span A cuts Senkou Span B from above at H. The price is currently at G and inside the Kumo cloud. This is an average Sell signal.

Average SELL signal when Senkou Span A cuts Senkou Span B
Average SELL signal when Senkou Span A cuts Senkou Span B

Specific example

Senkou Span A cuts Senkou Span B at point S. The current price is at point R which is above the Kumo cloud. This is a strong BUY signal. We enter the order at point S and set stop loss below the Kumo cloud (also known as support). When Senkou Span A cuts Senkou Span B from above, it is time to exit at point V.

Open a BUY order with two Senkou Span
Open a BUY order with two Senkou Span

The Senkou Span signal is quite simple so it is necessary to pay attention to the trend of the larger timeframe before entering the order. Once we have identified the trend in the large time frame, we need to wait for the Senkou Span signal to be confirmed by strong candles.

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Ichimoku trading strategy with the Senkou Span (Part 7)
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