1/11 In its first version, Ichimoku consisted only of Kijun Sen and Tenkan Sen - no cloud and no Chiko Span. These two lines (the mid S/R and the short S/R) provide a signal when they cross. Many people assume that the mere fact that Tenkan has gone over Kijun is strictly

2/11 ❓First, let's try to understand the logic of why Tenkan Sen crossing above Kijun Sen is supposed to be bullish (or vice versa). Tenkan Sen is the middle value of the highest high and the lowest low in the past 9 candles. We can think of it as a middle of the short term

3/11 ❓On the other side, what would make a Tenkan Sen or Kijun Sen stay flat? They would stay flat if for 9 or 26 candles respectively there is no higher high or lower low and the range stays the same.

4/11 What would make any of these lines to slope in the opposite direction of the trend? If we get a lower low or a lower high within the 26 candles extremes, Kijun Sen would turn down. Same for Tenkan Sen, with 9 candles. And vice versa: if we renew the range high or set a

5/11 ❓Now, if we expect the TK cross to be a bullish signal, why do we expect that? Because we expect that the price is entering a new, fresher range with higher highs / higher lows and thus is decoupling from the old range.

6/11 ❓With that being said, if you see Tenkan Sen crossing above Kijun Sen, but Kijun Sen turning down, should this be a valid cross/buy signal? Of course not. Because the shorter term/fresher range is indeed higher. But the price is still in a bigger, 26-candles long range,

7/11 ❓If Tenkan Sen crosses above Kijun Sen, but Kijun Sen stays flat, is this a valid cross? No. Because the shorter term range is indeed higher, but the mid term range with 26 candles stays the same. This means that the HL or HH causing the short term range to be higher is

8/11 ❓So what do we want for a real cross? The price to get out of the mid term range and to start making new HL/HH. This can be achieved with the following rules, which should be covered for a TK cross to be real: 1⃣ Tenkan Sen must start going away from Kijun Sen. Because

9/11 ❓A logical question is: if we need so many confirmations and may need a few candles for them, isn't it too late until we understand if the cross is fake or not? And yes, it may be a bit late, sometimes more late. But in TA, where everything is probabilities, we pay the

10/11 One more thing. If we see a death cross in an uptrend, which doesn't cover the conditions for a real one - or a golden cross in a downtrend. We can assume that this is not a reversal signal as it may be a fake cross. But the fact that we are seeing a death cross on an

11/11 If you found this thread useful it could be great to like and share the original tweet. I don't sell anything, I just share my knowledge for free. I don't have a lot of followers so if you think this knowledge is worth it to reach more people you can help the Twitter

Previous lessons: 1. The Ichimoku TA system https://x.com/drpastet/status/... 2. Tenkan Sen https://x.com/drpastet/status/... 3. Kijun Sen https://x.com/drpastet/status/...

@drpastet Thank you for providing such clear and well thought out threads like this. I am impressed and really never knew much about Ichimoku. I can't believe you did this for free but I really appreciate it.

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@drpastet Love the advanced insights👍, many thanks for these lessons & your efforts!

@kapitelgossn My pleasure, thanks for your support!

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