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 Gold Customer
Joined: 3/28/2005
Posts: 31
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I've just wasted a perfectly good weekend trying to make sense of the Ichimoku Kinko Hyo charts. In fact, it has even goten to the point that my wife noticed that when I speak, the words are now out of sync with my mouth. Here are my conclusions.
As you may know, the basic buy and sell signals are when the tenkan sen crosses above or below the kijun sen. Supposedly, you want a buy signal above the cloud and a sell signal below. This may work in the Forex. Curencies have a reputation for being good trending markets. But you really don't have to look at too many charts of stocks to realize that these signals are about as useless as a whistle on a plow.
But wait! Check this out for yourself. I have yet to backtest this; it's just an initial impression. Paint the bars on a daily chart red for a sell signal and green for a buy. Wait for a sell signal where the red bar closes in or above the cloud. You fade this signal on the next opening.
There are two possible exits.
1) If a bar closes below the cloud, place a sell stop 1.5% below the low of that bar.
2) If you are not stopped out, wait for a green bar and sell on the next open.
I really think so.
Beans-in-the-teens
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Registered User
Joined: 7/1/2008
Posts: 889
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I've learned some about cloud charts but have yet to comprehend why they should be of any value.
What is Beans in the teens??
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Gold Customer
Joined: 3/28/2005
Posts: 31
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QUOTE (ben2k9) I've learned some about cloud charts but have yet to comprehend why they should be of any value.
What is Beans in the teens??
Beans-in the teens is a relic from my earlier days as a futures trader. Every spring, when the weather market in grains would start to take off, some lunatic commentator or newsletter writer would proclaim that this was the year we would see beans in the teens, i.e. above $13 per bushel. $8 or $9 was about the highest I ever saw. They came pretty close last summer, I think.
The cloud charts have to be of value. After all, they come from the inscrutable Orient, and consequently, they are at once picturesque, poetic,romantic, and heroic. These people eat octopus and sea urchin roe. You have to take them seriously.
But don't take my word for it. If you have stockfinder, put in the signals i described and see for yourself. If you don't have it, get it. It's a killer.
Beans-in-the-teens-----maybe this year.
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Registered User
Joined: 7/1/2008
Posts: 889
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I have cloud charts on the Bloomberg. I don't believe they give me any more than a moving average does.
but I haven't closed the book on cloud charts yet, just didn't see anything compelling about them yet to warrant a whole lot of attention....
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Registered User
Joined: 1/30/2009
Posts: 267
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Well, as I live in Japan (yes I eat octopus but the sea urchin roe is absolutely nasty) I will have a look at this.
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Registered User
Joined: 1/30/2009
Posts: 267
|
Well, as I live in Japan (yes I eat octopus but the sea urchin roe is absolutely nasty) I will have a look at this.
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Registered User
Joined: 1/30/2009
Posts: 267
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How can I do this using StockFinder?
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Gold Customer
Joined: 3/28/2005
Posts: 31
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QUOTE (hiromj) How can I do this using StockFinder?
Click on the tenkan sen line. Make two rules. The red rule is tenkan crossing below the kijun, and the green rule is the opposite. To find long entry signals, scan your watch list for the red rule. On average, you'll get three to four signals per year on the daily chart of a stock.
I suspect that these cloud charts, which are basically a trend following method, work much better in the forex. The currencies tend to be more trendy than the liquid large and mid-cap stocks. Hence, I'm trying to use these charts in a way that's not trend-following. My guess is that a good use of these charts for the average technical trader in stocks, is simply to display the cloud as a zone of support or resistance. I'm intrigued by these charts, and will try to learn more about them.
If you think uni is nasty, you wouldn't last five minutes on Iron Chef.
Beans-in-the-teens
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