My trading template is on 15m chart. I use three main components to enter a trade.

1. 4h and daily Ichimoku lines. Those lines are drawn as support/resistance on the 15m chart.

2. A fast stochastic(Non-lag) using 5 periods.

3. A regular stochastic using 65,20,3 as parameters.

The rule of enter a trade is:

1. Price clearly bounce off a 4h/daily ichimoku line. non-lagging MA confirmed changing trend.

2. Fast Stoch cross at low for long and at high for short.

3. Slow Stoch cross at low for long and at high for short.

Please see this EJ example today.

The blue line EJ bounced off is the 4h Ichimoku Kijun Line.  Those three arrows showed conditions 1-3 are met.

Our profit target is next Kijun line if exists. In this chart, it was the pink line(daily Tenkan), total profit is about 80 pips.

The thick Blue Horizontal line is 4H kijun-sen. The Thin blue line is 1H Kijun-sen.

The thick red line is 4H Tenkan-sen. The thin red line is 1H Tenkan-sen.

As you can see from following 1H chart, it bounced off the 4H kujun-sen nicely on Friday Morning after 9am.

Our rule of thumb for Forex market is:

1. Use 4h to find the bounce/trend

2. Use 1h to confirm.

3. Use 15m to enter.

The aggressive play would be Short Usd/Cad between 9am to 10am. The price is clearly bounce off 1h 200SMA line + 4h Kijun-sen line.

However, because it was Friday and I didn’t want to hold anything through weekend, I missed the first chance.

Now I am preparing to Short at the second wave next week.

See this 15m Chart using the same setting. 3 groups of stochastic indicators are used, they are 15m/1h/4h in order. As you can see, 4h stochastic is ready to cross which 1h/15m already too late to enter. I would prefer to wait until 1h to have another bounce. But I will definitely wait for 15m stochastic to have one more bounce and short at 15m cross at the top.

Simply put, in Ichimoku system, when Kijun-sen is over Tenkan-sen, it is supposed to be short. But what about price breaking up and cross Kijun-sen line?

That’s what I call divergence in Ichimoku.

Set up check list:

1. Divergence: Kijun-sen line and Tekan-sen line and price action shows opposite direction.

2. Price break Kijun-sen: Price going up and 4h bar has confirmed breaking Kijun-sen line.

3. Kijun-sen then become support. (This is the most important bar in this system). We need to make sure Kijun-sen line then become a support and continue to show the price movement trend.

Stop Loss: If a reverse candle confirmed to re-break the Kijun-sen line, we cut loss.

Take Profit: Use pivot or MA lines to take profit. Lock free trades as usual.

Kijun-sen Line is calculated based on (HIGHEST HIGH + LOWEST LOW)/2 for the past 26 periods.

I can see it to represent a nice 50% fib line on 4h or 1h chart.  (Yes,  it is a cheat but I try to keep it simply/lazy  so I don’t have to draw it myself. )

However, default triggers from Kijun-sen systems are many times too late. I have combined the fib-line system with Ichimoku Chart and comes up with my own triggers.

This blog will introduce set #1: Attack the second wave

Check list for the entry based on 4h chart only:

1. Tenkan has already crossed Kijun to confirm the trend.

2. Price has trended beyond Tenkan and retrace back to test Kijun.

3. Price has confirmed to have Kijun Support.

Use Kijun-sen as s/l, we enter the trade to attack the second wave.

See following chart for example,

In this chart 4 hour Gbp/Usd, there are there check signs to represent each of the conditions of this trigger.

Note 1: In this chart, there is also a hidden purple dotted line, which is the Gann Indicator. It’s important to monitor that indicator and make sure it didn’t flip to against our trade too close to the Kijun-sen line.

Note 2: Make sure the previous high/low on the same chart do not show MACD divergence.

Note 3:  In my trading, I would prefer to have the support of Gann or Ma cross in 4h chart to confirm the bounce.

Here is another example,