The informal description
Indicator Ishimoku successfully unites in itself variety of other indicators and various approaches to forecasting of movement of the price.
Each line represents the middle of a price range for a certain time interval. So it shows dividing border of prevalence bull, or the bear force of the market. It is possible to tell still – a consensus of weights concerning cost for the certain period. Last determination coincides with treatment of moving average at Elder, but the line of Ishimoku is under construction other method and doesn’t gravitate to closing prices.
Any line of Ishimoku INSTANTLY reacts to occurrence of a new extremum for the time range. No delay is present. It is convenient for using as a trend signal. Such property other a little widespread indicator – АРУН possesses.
If to look narrowly at a line of Chinkou Span we identify the old acquaintance – momentum. The price is compared with by itself a certain time frame ago.
So, we have the multiplane indicator combining indexes of a trend, levels of possible recoils, support and resistance areas and oscillator. A difficult trading system combines various approaches. A masterpiece, similar to which we don’t know!
The author advises to set values of lines (consistently) – 9, 26, 52, 26. Makes a reservation that these dimensions – the best in the Nikkei index market – stock market of Japan. We argue. Shares buy for a long time. In this sense the best schedule is a week schedule. Then dimension of the longest line is a year. It is logical, for a certain recurrence of activity of any market is present at any speculative tool, and it is more than for a year forward to think to the speculator, probably, it is not necessary – to lose contact to a reality too easily. Dimension built in momentum – 26 that is equal to half of base market cycle. Elder in every possible way advises and to arrange oscillators – under half of cycle and it is pleasant that other clever person – Ishimoku – with it agrees. On our supervision Dow Johns’s index approaches to Ishimoku even better than native to the indicator Japanese shares.
If the schedule not week, and, for example, five-minute such dimensions will be deprived, so to say, physical sense and the indicator works badly. The dimensions focused on other cycles of market activity are necessary. Thus on schedules of different time frames it is necessary to set different dimensions of the indicator.
Basically it is possible to conduct even one line and at a finding of the price below it to search for possibilities to sell and if above – that to purchase. But the combination of all lines gives new quality – results of such analysis better, than the summed up results of each of lines separately.
Without going into detail of our technique we will notice that considering movements after a signal on Ishimoku, we have received good results in the most different markets and in various time frames. And minuses have been limited by stop – losses and were on the average below possible profits.
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