albert.callisto

How Ichimoku can be used to detect and anticipate ranges

Education
FX:AUDCAD   Australian Dollar/Canadian Dollar
Twist is the place where the cloud rotates, in other terms they form when the SSA crosses the SSB. Ichimoku can be used to detect ranges by looking at the successive and aligned twists of the cloud. In a perfect range, the twists would be perfecly aligned on the same horizontal level. In practice, this is never the case but you can still spot those that are aligned with some tolerance. If the twists are not aligned at all, you are in a trend and by definition, no ranging is to be expected at this timeframe.

The twists in a range are forming an area which is neutral to some extent, you can see it as the "center" of the range. This is where the market will either bounce or continue oscillating inside the range until it reaches the opposite part. You can use the flat parts of the Kijun/SSB to trace a rectangle around your range or use the wicks/close of the highest/lowest candles.

Look for an incoming range by analysing the trend of the cloud. Is it getting thinner (SSA getting closer to SSB) and will do a twist during the next candle? In this case, you may expect the range to continue.

Thanks to Patrick Riguet for his invaluable expertise in Ichimoku and all these tips.

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