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Ichimoku Kumo breakout strategy ...
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Ichimoku Kumo breakout strategy ...

  #11 (permalink)
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redratsal View Post
Ichimoku was created for currencies on daily charts, it works with different instruments and time frames as well, you need to play around. Interesting webinar on the topic #301 & 302 https://futures.io/elite-circle/3383-upcoming-webinars-training-education-31.html

In his book Amazon.com: Trading with Ichimoku Clouds: The Essential Guide to Ichimoku Kinko Hyo Technical Analysis (Wiley Trading) (9780470609934): Manesh Patel: Books Manesh did some backtesting on specific strategies.

It was created for daily charts and IMO is the best place for it.
However, some traders trade well with it on smaller time frames because they have great
risk/money management skills.

The indi itself is nothing more than four (HH+LL)/2 averages and an SMA of the close shifted back n periods.
Traders use averages on all time frames.
Lagging indicators are hard to use on time frames less than 60min IMO.


Last edited by Massive l; October 11th, 2011 at 03:59 PM.
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  #12 (permalink)
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.............

Anyone got any ideas on how to get that NT7 strategy to work how I want it - or can let me know if in fact it already does do a kumo breakout validated by a CS cloud break and I am just not using it correctly ?

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  #13 (permalink)
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I think this is what you are looking for, for convenience I used my Ichimoku indicator which I am more familiar with but the logic is the same:

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  #14 (permalink)
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Very strange ..........

@redratsal
Really strange behavior from this little baby.
Here are the screenshots of my backtest, the Setup1, Setup2, and the resulting chart
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Take a look at the sell signal near the end of May. The cloud is green, which means the Senkou A is below the Senkou B, check ? So the sell signal is given on the chart whilst the price bar closes around the sell signal are all higher than the Senkou A, in contradiction to the strategy in the condition builder. Unless I have missed something, what on earth could be going on ?

BTW the strategy in your example seems to be a variation on the Kumo Twist. The one I am really interested in is the Kumo breakout, where the price close crosses the Kumo to the upside, and then (timewise) the Chikou span breaks out above the Kumo to the upside (in the buy example). I have tried putting that strategy into the condition builder and it does not work. I get signals that do not appear where I think they should. I think it is because of the time shifting, but I do not rule out an inconsistency in NT7.

If we can get some more input here that would be great because I don't want to load this all onto redratsal's shoulders, who has given a lot of input already which is much appreciated.

Thanks all


Last edited by Overview; October 12th, 2011 at 09:09 AM.
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  #15 (permalink)
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Your Ichimoku and mine are plotting differently (26 periods of difference), I have to check the codes as I beleive the strategy is acting on my indicator while it is plotting on the chart with yours shifted of 26 periods. I will give a look asap.

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  #16 (permalink)
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...............

Can anyone lend us both a hand here ?

Thanks !!!!!

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  #17 (permalink)
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Kumo+26


Overview View Post
Can anyone lend us both a hand here ?

Thanks !!!!!

Not sure if I understood the question....The cloud is supposed to be shifted forward 26 periods, a future kumo should be plotted showing future S/R zones 26 periods ahead of price.

The indicator in the chart shown earlier that plotted the Kumo that extends ahead of price has the correct calculation.


Quoting 
SENKOU SPAN A ("1st leading line") (TENKAN SEN + KIJUN SEN)/2 time-shifted forwards (into the future) 26 periods


Quoting 
SENKOU SPAN B ("2nd leading line") (HIGHEST HIGH + LOWEST LOW)/2 for the past 52 periods time-shifted forwards (into the future) 26 periods

src: www.ichimoku.org

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  #18 (permalink)
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& in respect to your strategy. I believe Patel suggests using the Kumo as your entry and targets generally only on longer term charts ex: 4H or daily. If you want to use Ichimoku on smaller time frames you should have Tenken/Kjum plotted as well as Chikou, the kumo or price breakout (above/below kumo) of the Chikou are arguably the best signals. You should also be using HTF kumo that lines up with your trade.

^I cited this coming from Patel's book but it's highly probably that I heard it somewhere else, there are a lot of different interpretations but the only backup data I have seen has come from his book.

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gonzofist View Post
& in respect to your strategy. I believe Patel suggests using the Kumo as your entry and targets generally only on longer term charts ex: 4H or daily. If you want to use Ichimoku on smaller time frames you should have Tenken/Kjum plotted as well as Chikou, the kumo or price breakout (above/below kumo) of the Chikou are arguably the best signals. You should also be using HTF kumo that lines up with your trade.

^I cited this coming from Patel's book but it's highly probably that I heard it somewhere else, there are a lot of different interpretations but the only backup data I have seen has come from his book.


Patel is kind of a "strict constructionist" , meaning he alters nothing in regards to time frame or instrument. Mike has him set up to do a webinar here in the near future as well as another guy that should help you guys out (me too). The daily is where Ichimoku really shines and all the "lines" are important, I have actually been sucessfully using it on a 15m chart which would probably make some people cringe. I do monitor daily and 4hr as well though. Oh, and without getting to far off topic the chikou loses a lot if not most of it's significance on the smaller time frames, but the others retain thier significance.

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  #20 (permalink)
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strategy coding problem not indicator problem ....


I reckon the indicator is indeed working fine. The Chikou is shifted back, and both Senkou A and B are shifted forwards.

The problem exists with the strategy, not the indicator. If I take the indicator, and try to construct a Kumo breakout strategy within the wizard, I can't get it to work. (BTW I do want this for daily and 4hr charts primarily)

As far as I understand it, a Kumo breakout strategy means (in time sequence):
1) Price breaks cloud (max of Senkou A and Senkou B) to the upside.
2) The Chikou span confirms by also breaking the cloud to the upside. - this of course appears to the left of the actual price, but it (normally?) happens later, ie at a time a few bars after the actual price clears the cloud.

I guess it is not impossible for 2) to happen before 1) ?

And the above is for a break to the cloud to the upside. The reverse is true for a downward cloud break.

To test this I did a simple strategy in the wizard (using an exit based on price crossing the cloud in the other direction), but I could not get it to put the buy and sell signals in the right places. Any chance that one of you good people could have a go and see if you can crack this ?

I think it might need a couple of internal variables one of which is max(Senkou A and Senkou B) and the other which is min (Senkou A and Senkou B) so I can just check whether the cloud has been crossed without having to worry about which Semkou span is higher. And the other bit that has really foxed me is trying to compare a backward shifted Chikou with a cloud that has been shifted forwards. I have absolutely no idea how to do this in the strategy wizard - let alone Ninjascript ....... hope that states the problem clearly !!


Last edited by Overview; October 16th, 2011 at 08:27 PM.
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