- 1 Introduction to the Ichimoku Cloud Indicator
- 2 What is the Ichimoku Cloud Indicator?
- 3 How the Ichimoku Cloud Indicator Works?
- 4 How to use the Ichimoku Cloud Indicator for MT5
- 5 Conclusion
- 5.1 MT5 Indicators – Download Instructions
- 5.2 Recommended Forex MetaTrader 5 Trading Platforms
Introduction to the Ichimoku Cloud Indicator
The Ichimoku Kinko Hyo Indicator is one of the few technical indicators which can claim to be a complete trend following trading system.
The Ichimoku Cloud Indicator uses the long-term trend component of the Ichimoku Kinko Hyo system so that traders may combine it with other short-term trend indications.
What is the Ichimoku Cloud Indicator?
The Ichimoku Cloud Indicator is a long-term trend following technical indicator which is based on the Ichimoku Kinko Hyo Indicator.
This indicator plots a cloud-like area which is called the “Kumo”, which means “Cloud” when translated from Japanese. This Cloud changes color to indicate the direction of the long-term trend.
Price action is usually above the Cloud whenever the market is in an uptrend. It plots a pale green Cloud to indicate a bullish long-term trend direction.
On the other hand, price action is usually below the Cloud whenever the market is in a downtrend. It also plots a thistle Cloud to indicate a bearish long-term trend.
How the Ichimoku Cloud Indicator Works?
The Ichimoku Cloud Indicator first calculates for the Tenkan-sen and Kijun-sen, which are components of the Ichimoku Kinko Hyo Indicator.
The Tenkan-sen median of price over the past nine periods. The Kijun-sen on the other hand is the median of price over the past 26 periods.
It then calculates for the average of the Tenkan-sen and Kijun-sen. Based on the results, it then plots a line shifted 26 periods ahead. This would be the Senkou Span A line.
It then calculates for the Senkou Span B which is the median of price over the past 52 periods shifted 26 periods ahead.
The indicator detects a bullish trend whenever the Senkou Span A is above the Senkou Span B, in which case it would shade the area between the two lines pale green.
On the other hand, it detects a bearish trend if the Senkou Span A line is below Senkou Span B, in which case it would the area between the two lines thistle.
How to use the Ichimoku Cloud Indicator for MT5
Although the classic Ichimoku Kinko Hyo Indicator has a preset number of periods used for each line, the Ichimoku Cloud Indicator allows users to modify the variables used on its underlying lines.
The “Tenkan-sen”, “Kijun-sen”, and “Senkou Span” variable fields refers to the number of periods used for each line. Modifying these variables would modify the time window in which the median of price action is calculated.
The Ichimoku Cloud Indicator is best used as a long-term trend direction filter using the color of the Cloud as a basis for trend direction.
Buy Trend Direction
Take long or buy trade positions exclusively if the Ichimoku Cloud is pale green indicating a bullish long-term trend.
Sell Trend Direction
Take short or sell trade positions exclusively if the Ichimoku Cloud is thistle indicating a bearish long-term trend.
Theoretically traders can use the changing of the color of the Ichimoku Cloud as a trend reversal entry signal. However, these trend reversal signals do not always present a precise trade entry. This is why it is better to use this indicator solely as a trend direction filter wherein traders would take positions only in the direction of the long-term trend indicated by the color of the cloud.
MT5 Indicators – Download Instructions
Ichimoku Cloud Indicator for MT5 is a Metatrader 5 (MT5) indicator and the essence of this technical indicator is to transform the accumulated history data.
Ichimoku Cloud Indicator for MT5 provides for an opportunity to detect various peculiarities and patterns in price dynamics which are invisible to the naked eye.
Based on this information, traders can assume further price movement and adjust their strategy accordingly. Click here for MT5 Strategies
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How to install Ichimoku Cloud Indicator for MT5.mq5 to your MetaTrader 5 Chart?
- Download Ichimoku Cloud Indicator for MT5.mq5
- Copy Ichimoku Cloud Indicator for MT5.mq5 to your Metatrader 5 Directory / experts / indicators /
- Start or restart your Metatrader 5 Client
- Select Chart and Timeframe where you want to test your mt5 indicator
- Search “Custom Indicators” in your Navigator mostly left in your Metatrader 5 Client
- Right click on Ichimoku Cloud Indicator for MT5.mq5
- Attach to a chart
- Modify settings or press ok
- Indicator Ichimoku Cloud Indicator for MT5.mq4 is available on your Chart
How to remove Ichimoku Cloud Indicator for MT5.mq5 from your Metatrader 5 Chart?
- Select the Chart where is the Indicator running in your Metatrader 5 Client
- Right click into the Chart
- “Indicators list”
- Select the Indicator and delete
Ichimoku Cloud Indicator for MT5 (Free Download)
Click here below to download: