Ichimoku cloud is combination of technical indicators that show support and resistance areas, momentum and trend direction. While moving averages are based on closing price,ichimoku system is based on high and low of the past price data.
If Ichimoku cloud is green then it means trend is bullish and if ichimoku cloud is red then it means trend is bearish. Red Line is Tenkan Sen line and blue line is Kijun Sen line.If Tenkan Sen line is above the Kijun Sen line then it adds more to bullishness. If Tenkan Sen Line is below the kijun Sen Line then it adds more to bearishness.
Fibonacci Bands are used as support and resistance indicator in this trading system. Moving Average of 233 period, a Fibonacci number, is used as pivot and then Bands are created from 0.618 deviation of the Moving Averages. If price is in up trend and Slope of band is up, those bands tend to provide support for the trend. If trend is down and slope of band is down, then bands tend to provide resistance to the price.
If ichimoku and bands both are in bullish mode then traders should look for buy opptournities & if both are bearish then traders should look for bearish opportunities.
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