Forex glossary
Ichimoku Cloud (Ichimoku Kinko Hyo)
Ichimoku Kinko Hyo combines Tenkan-sen, Kijun-sen, Senkou A and B forming the cloud, and Chikou. It uses price-range midpoints and forward or backward plot offsets. It describes trend and zone relationships; shifted lines neither use future prices nor measure certainty that support will hold.
Illustrative example
How does it work in practice?
Assume the highest high over nine periods is 110 and the lowest low is 100. Tenkan-sen is 105, the range midpoint; it is not the average of those nine closing prices.
A case to work through
Calculated now, plotted ahead
Hypothetically, a line calculated from data available today is 105 and its plot offset is 26 periods.
- The value 105 comes from information known at calculation time.
- The offset places it farther along the chart without adding future observations.
What follows? In tests, assign it to the correct data-availability time.
Example boundary: A future plotting position does not predict the future price.
Calculation and plotting time
Text description of the diagram
- Historical window: Uses observations available at calculation time.
- Line value: Comes from the chosen component's formula.
- Plot offset: Places the value ahead or behind along the axis.
A useful distinction
Ichimoku Cloud (Ichimoku Kinko Hyo) / Moving Average (MA)
Ichimoku uses range midpoints and offsets among its components; a moving average weights selected observations.
Check your understanding
Identify historical inputs behind a forward-plotted line.
Show the answer and explanation
The drawing position of an already calculated value
The offset does not change when the inputs became available.
Direction and strength tools
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Related terms
Sources and documentation
- StockCharts – Ichimoku
Range midpoints, cloud components and forward/backward plot offsets.
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