Winning Ichimoku Strategy 19-Jan-2016

Winning Ichimoku Strategy for 1 min chart.

Commence trading on the second day of the week with a winning ichimoku strategy. To sell when the price is below the cloud. As always said, sell if below the cloud, buy if above the cloud, the basic fundamental for a winning ichimoku strategy.

The chart below reflected how the trade was entered and exited.

winning ichimoku strategy

How to trade a winning ichimoku strategy

I have marked out 4 areas on the chart to explain the trade I have executed.

It was about 9pm local when I looked at the ichimoku charting. Prior to 9pm, GBPJPY had been trending downwards. And the price action was far away from the cloud low at 1. If to go into short position at 1, with stop loss above the cloud, would have to risk quite a number of pips, meaning have to reduce my sizing to accommodate my dollar risk value, which was not what I wanted.

Waited for about 45 minutes, the price action when into the cloud. This was reflecting uncertainty in the price action. It could go higher or lower (again) when the price was in the cloud.

At point 2, carried out an assessment as the price action was penetrating the cloud high soon. Determined that for an effective long trade, will need the chikou span to go above the cloud high too. But the chikou span was just about to penetrate into the cloud. As such, placed a stop in order to go short in the event price action turned around. Indeed, price action turned around, and was triggered in.

Price did not go down immediately. It traded sideways before trending down. At point 3, tenkan sen and kijun sen were converging. Reduced position by half to take profit. Left the remaining position opened.

At point 4, price action continued to trend upwards. The price action went into the cloud. Decided to close the remaining position.

The above is a simplified winning ichimoku strategy that works on the fundamental principle: short if below the cloud and long if above the cloud.

 

 

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