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Chikou Span Formula and Interpretation

The document outlines key components of the Ichimoku Cloud trading system, including Senkou Span A and B, which serve as dynamic support/resistance and volatility indicators, respectively. It also describes the Chikou Span, which helps confirm trends and potential reversals based on its position relative to the current price. Each component is projected or shifted in time to provide insights into market behavior.

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jewel2030
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12 views1 page

Chikou Span Formula and Interpretation

The document outlines key components of the Ichimoku Cloud trading system, including Senkou Span A and B, which serve as dynamic support/resistance and volatility indicators, respectively. It also describes the Chikou Span, which helps confirm trends and potential reversals based on its position relative to the current price. Each component is projected or shifted in time to provide insights into market behavior.

Uploaded by

jewel2030
Copyright
© All Rights Reserved
We take content rights seriously. If you suspect this is your content, claim it here.
Available Formats
Download as PDF, TXT or read online on Scribd

 3.

Senkou Span A (Leading Span A):


• Formula: (Tenkan-sen + Kijun-sen)/2, projected 26 periods into the future.
• Purpose: Forms one edge of the Ichimoku Cloud (Kumo).
• Interpretation:
• Acts as a dynamic support or resistance boundary.
 4. Senkou Span B (Leading Span B):
• Formula: (52-period high + 52-period low)/2\text{(52-period high + 52-period low)} / 2(52-
period high + 52-period low)/2, projected 26 periods into the future.
• Purpose: Forms the other edge of the Ichimoku Cloud.
• Interpretation:
• Wider clouds indicate high volatility; narrow clouds indicate low volatility.
 5. Chikou Span (Lagging Span):
• Formula: Current closing price, shifted 26 periods into the past.
• Purpose: Confirms trends and potential reversals.
• Interpretation:
• Price above Chikou Span: Bullish confirmation.
• Price below Chikou Span: Bearish confirmation.

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