The Ichimoku is an indicator that was invented by a Tokyo newspaper writer.

It is a versatile indicator that defines support and resistance, identifies trend direction, measures momentum, and provides trading signals.

It combines three indicators onto the chart:

Senkou Span A & Senkou Span B: The area between these two lines is the ‘cloud’; it behaves as support and resistance for the price.

The wider the cloud, the stronger the support/resistance.

Tenkan & Kijun Sen: Used as a moving average crossover, both lines are simple translations of the 20-period and 50-period moving averages, although with slightly different timeframes.

Chikou Span: Used to gauge simple market sentiment, it compares the recent closing price with the one 26-period shifted back.

If the price is it is above the ‘closing price’, then it is considered as an up signal, and if the price is below the ‘closing price’, it is considered as a down signal.

The Ichimoku indicator can be found in the trading platform under ‘Insert -> Indicators -> Custom -> Ichimoku’.