Ichimoku Cloud
The Ichimoku Cloud is a technical analysis tool that helps traders understand market trends, momentum, support, and resistance levels by plotting averages on a chart. It consists of two key components: - TenkanSen: A short-term moving average indicator. - KijunSen: A long-term moving average indicator. The cloud is formed by plotting these averages and can provide valuable insights at a glance: - Uptrend: If the price is above the cloud. - Downtrend: If the price is below the cloud. - Neutral: If the price is inside the cloud. When the cloud and price move in the same direction, it signals a stronger trend, increasing the confidence in that direction.
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