I admit that today's topic is really interesting because we will deal with one of the most popular indicators. Interestingly, no one practically asked about this tool, and believe me, it's really worth learning about it. At the outset, I note that in this article there will be a lot of simplifications and I will not use the original names of individual lines because they are in Japanese and it is hard to remember them, let alone associate them. I would also like to add that Ichimoku's strategy is to follow the trend, and the lines make it really easy to determine whether the price is currently in the trend or not. Let's get to the point.

At first glance, this may all seem complicated, but it's not as bad as it looks. This red angular corridor is a bar showing what the market attitude is currently. If this bar is green then we have an upward trend, and if it is red then there is a downward trend.

The red and blue lines are so-called signal lines (I call them that). Simply put, if they cut in the right way, they generate a buy or sell signal.

The green line is an ordinary filter which works in such a way that if there is a downward trend then this green line must be under the price. If the green line breaks the price level, growth should be expected in the near future. The situation is similar in the case of an upward trend.

To the previous screen, I added the place where the position should be opened based on the intersection of the lines. As you have probably noticed, the strategy does not sin with a large number of signals, but it is not a defect - it is better to have a few more certain signals than several dozen uncertain ones. Especially I do not give the time of plays because I do not treat it as a strategy, but only a tool to help you better understand the market.

Signal on PUT

• There is a downward trend
• The green line is below the price
• The blue line crosses the red line from above

Signal on CALL

• There is an upward trend
• The green line is above the price
• The blue line crosses the red line from below

Okay, everything is fine, nice, but what to do if you enter the market and see a tangle like in the picture above? This is a very common situation on the market because most of the time the price is more or less stagnant. If you encounter a phenomenon that I call a "storm" just don't trade with the trend because it doesn't make any sense. It is good to use indicators such as the Stochastic Oscillator or RSI at this time because we are practically sure that the market is currently stagnant and there is nothing else for us to do but draw a price corridor and play against stagnation.

I hope that the article was legible and understandable and explained the most important issues related to Ichimoku Cloud in a simple way.