Trading Strategy
Greetings profits for traders of all. On the last occasion I have introduced the indicator Ichimoku Kinko Hyo. And on this occasion I will explain how we use the Ichimoku Kinko Hyo is a Trading Strategy We.
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Kumo / Cloud
Kumo means cloud in the Indonesian language, is the most important and most unique concepts that need to be understood first. Kumo is formed due to the difference between the two lines Span A (1st div) and Span B (2nd div). The trader using Ichimoku often use the terms Up and Down Kumo Kumo to describe the position of the clouds that form on the graph. Up Kumo occurs when the Senkou Span A line above the line Senkou Span B. And conversely Down Kumo SpanA Senkou lines form when under the Senkou lines SpanB.
Use of Kumo
Kumo is used role in three ways, namely to identify trends, identifikasih areas of support and resistance, and as an indicator of price volatility. We discuss one by one function Kumo.
1. Trend
A trader can easily identify trends with a very simple way, namely by comparing the position of Kumo on prices.
• If the price under the Kumo, then assumed the overall bullish trend.
• If the price moves above Kumo then tremd overall assumption is bearish.
• And if the price moves between areas Kumo then the assumption is a sideways trend or bias.
2. Support and Resistance
Guidelines used for determining the basic support and resistance is quite simple, just by making a line Kumo as a benchmark of determining support and resistance.
• When Uptrend, line the top of the Kumo will serve as the first support. While the line or the lower limit Kumo acted as Advanced Support
• And conversely, when the Trend Down (when Kumo is above the price) then the lowest part of the Kumo will serve as a first resistance and the highest as a follow-up Resistance
3. Volatility
If we look at Kumo have different thicknesses, according to the price movement. (This thickness is the distance between the two lines forming Kumo Senkou Span A & B). The thicker the Kumo, the higher the volatility of price movements. And demikina versa.
This occurs because of differences in the period between Senkou Span lines A and B. The high volatility of prices will force the line away from the span A span B, and form a thick Kumo itself. And conversely, if the volatility of small then A will mendekan span to span B and thickness Kumo will thin out.
Through this identification, the User Ichimoku Kinko Hyo will be easier to conclude when it will happen or change Trend Reversal.
• Down The trend began after prices broke through the area Up Kumo.
• Up trend starts when price broke through the area Down Kumo.
Ichimoku @ Forex Factory
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Forex is simple follow the trend and you will rich.
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