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Technical Analysis

Ichimoku Cloud

A multi-component Japanese indicator giving trend, momentum and support/resistance at a glance.

Definition

Developed pre-WWII by Japanese journalist Goichi Hosoda, Ichimoku Kinko Hyo (一目均衡表, 'one-glance balanced chart') combines five lines to indicate trend direction, momentum and dynamic support/resistance. The Kumo (cloud) — the area between Senkou Span A and B projected 26 periods ahead — is the visual centrepiece. Price above a green cloud is bullish; below a red cloud is bearish; inside the cloud is a no-trade zone. The system is self-contained, requiring no other indicators.

Formula

Tenkan-sen (Conversion) = (9-period High + 9-period Low) / 2
Kijun-sen (Base)        = (26-period High + 26-period Low) / 2
Senkou Span A           = (Tenkan + Kijun) / 2, projected 26 periods forward
Senkou Span B           = (52-period High + 52-period Low) / 2, projected 26 forward
Chikou Span             = Close, projected 26 periods back

Worked example

BTC trades at $68,000 above a thick green cloud spanning $58,000-$62,000. Tenkan = $66,500 is above Kijun = $64,800 (bullish), and the Chikou span is unobstructed. The full setup confirms a strong uptrend; pullbacks into Kijun-sen are the highest-quality long entries.

How ARIA Analyst uses it

ARIA exposes Ichimoku as an optional indicator overlay and includes 'price-above-cloud' as a binary regime feature in its ML ensemble.

Related terms

  • Exponential Moving Average (EMA)

    A moving average that weights recent prices more heavily — faster than the SMA.

  • MACD

    Moving Average Convergence Divergence — a trend-following momentum indicator built on two EMAs.

  • Fibonacci Retracement

    Horizontal lines at 23.6%, 38.2%, 50%, 61.8% of a price swing — common support/resistance targets.

  • ADX

    Average Directional Index — measures trend strength from 0 to 100 without indicating direction.

See Ichimoku Cloud in action on any asset

ARIA Analyst computes Ichimoku Cloud automatically as part of a hybrid multi-agent investment report — 5 deterministic scoring agents plus AI augmentation (ML ensemble, Bull vs Bear debate, 10 Deep Search agents on Premium). Get yours in seconds.

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