Ichimoku Cloud LONG and SHORT indicators

2020年9月28日

This simple script uses 4 rules from Ichimoku Cloud indicator to marks position entry points.

The idea is that by entering a long position just when these 4 criteria are met, you can capture a 2-3% plus move within the next few days:
1. The conversion line is above the base line
2. The price is above the clouds
3. The lagging span is above the clouds
4. The rightmost cloud is green

The same 4 criteria but inverted will indicate a short entry.

In order to avoid 'stale' entries which can lead to chasing, we want the price and conversion line crossovers to be recent, within the past few days. Ideally we want to enter before close on the day the entry signal is given so that we can capture any potential gap up (or down if short). Often the price will make a nice move the next day or day after. If any of the criteria become invalidated, or if after 4-5 days there hasn't been significant movement, then it was a false alarm.

This script will show the basic Ichimoku Cloud indicators, plus labels for bearish and bullish price and conversion line crossovers as well as LONG and SHOT indicators to show when the entry criteria have been met.

2020年10月8日

リリースノート

This update makes the indicators respect any changes in the displacement value in the Inputs.

2020年11月30日

リリースノート

Pretty significant update:

added visual indicators to facilitate an exit strategy described below
removed price/cloud crossover labels as they are not very useful and this chart has more than enough clutter as is

the exit strategy is also documented in the code, but here it is:

1: set STOP LOSS at 1 std. dev. below close (RED DASHED LINE)
2: activate TRAILING STOP when price hits 1/2 std. dev. above close (BLUE DASHED LINE)
3: use 1/4 std. dev. as the TRAILING STOP value (GREEN DASHED LINE shows minimum expected profit in cases where blue line is reached)
4: after 5 more bars, exit trade if price is still between red and blue lines (no visual indicator for this at this time)

2020年12月9日

リリースノート

The main point of this update is to fix an edge case caused by the crossover function counting touches as crossovers.

I've also removed the SHORT callouts until such time as I have enough data to indicate this is a viable strategy.

Additionally I've updated the default plotting styles to reflect my preferences.

2021年3月1日

リリースノート

Some incremental improvements:
*updated initial defaults to reflect current strategy
*added ability to limit signals to long only
*added ability to display the standard deviation over the selected number of periods as a percentage of current price

2021年12月7日

リリースノート

now considering touches as crosses for determining entry eligibility for the cloud and the conversion/base pair

2022年2月28日

リリースノート

using ATR instead of stdDev, tweaking initial paramaters, tweaking colors for better visibiliity