Indicators · Trend · live Bitcoin example
Ichimoku cloud explained: how to read the Kumo
Kumo means “cloud” in Japanese – and yes, that is where our cat got its name! The Ichimoku cloud is a whole trading system in one picture: it shows the trend, likely support and resistance, and momentum at a glance. It looks busy at first. Once you know its five lines, it becomes one of the easiest charts to read.
What Bitcoin’s Ichimoku cloud says right now
Worked out from real Bitcoin candles and refreshed every 30 minutes. It describes what already happened – not what will happen next.
The Ichimoku cloud on the live Bitcoin chart
The live Bitcoin chart with only the Kumo cloud on. The green line is Span A, the coral line is Span B (the cloud lives between them), and the light blue line is the Kijun base line. The cloud is pushed 26 candles into the future, so you can see it ahead of the price.
What is the Ichimoku cloud?
The full name is Ichimoku Kinkō Hyō, which means roughly “one-glance equilibrium chart”. The idea is that one look should tell you whether the market is in balance or trending, and how strong that trend is.
It has five lines. Tenkan-sen (conversion line) is the middle of the last 9 candles’ highest high and lowest low – a fast line. Kijun-sen (base line) is the same idea over 26 candles – a slower line. Senkou Span A is halfway between Tenkan and Kijun, and Senkou Span B is the middle of the last 52 candles – both are shifted 26 candles forward. Chikou Span (lagging line) is today’s close drawn 26 candles back.
The space between Span A and Span B is the kumo, the cloud. When Span A is above Span B the cloud is usually coloured green; when Span B is on top it is red. A thick cloud means the levels are far apart; a thin cloud means they are close together.
Ichimoku uses the middle of the high–low range, not the average of closing prices. That makes its lines flat during quiet periods – those flat stretches often line up with levels traders watch.
Where it comes from: Ichimoku was developed by Goichi Hosoda, a Japanese newspaper writer who used the pen name “Ichimoku Sanjin” (“what a man on a mountain sees”). He worked on it from the 1930s with a team of assistants and published it in 1969. The 9, 26 and 52 settings come from the Japanese six-day trading week of the time: one and a half weeks, about a month, and about two months.
How the Ichimoku cloud is calculated
Every Ichimoku line is a “midpoint”: (highest high + lowest low) ÷ 2 over some number of candles. That is all the maths there is.
- Tenkan (9)(9-high + 9-low) ÷ 2Fast line. Middle of the last 9 candles.
- Kijun (26)(26-high + 26-low) ÷ 2Slow line. Middle of the last 26 candles.
- Span A(Tenkan + Kijun) ÷ 2Plotted 26 candles ahead.
- Span B(52-high + 52-low) ÷ 2Plotted 26 candles ahead.
| Last 9 days: high 110, low 90 | Tenkan = 100 |
|---|---|
| Last 26 days: high 118, low 84 | Kijun = 101 |
| Span A = (100 + 101) ÷ 2 | 100.5 (drawn 26 days ahead) |
| Last 52 days: high 125, low 75 | Span B = 100 (drawn 26 days ahead) |
| Cloud 26 days ahead | between 100 and 100.5, green (A above B) |
| Chikou | today’s close, drawn 26 days back |
In this example the cloud ahead is very thin, because the 9, 26 and 52-day ranges have almost the same middle. A thin cloud means the market has been balanced – and that a move through it may be easier.
How to read the Ichimoku cloud
The pictures are simple example shapes, so the idea is easy to see. Real charts are messier.
Price above a green cloud (sunny trend), falling into the cloud, then below a red cloud (rainy trend). Example drawing, not real data. Price and the cloud
Price above the cloud: the trend has been up and the cloud below is where many traders expect support. Below the cloud: the trend has been down and the cloud above may act as resistance. Inside the cloud: the trend is unclear – often sideways and choppy.
The fast conversion line (Tenkan) crosses above the slower base line (Kijun). Example drawing, not real data. Tenkan and Kijun crossing
When the fast Tenkan crosses above the slow Kijun, short-term momentum has turned up (sometimes called a TK cross). Crosses above the cloud are seen as stronger than crosses below it. The Kijun on its own is often watched as a level: price tends to come back to it.
The colour of the cloud ahead
The cloud being drawn 26 candles ahead shows how the 9/26 midpoint compares with the 52 midpoint right now. A green cloud ahead means recent prices sit above the longer range; a red cloud ahead means below. A “twist” (colours swapping) shows a change in balance.
Chikou: today versus 26 candles ago
The lagging line simply compares today’s close with the price 26 candles ago. If Chikou is above the old price, today is higher than it was a month ago. Traders use it as a final check that the trend is real.
Common mistakes beginners make
Almost everyone makes these at first. Knowing them saves a lot of frustration.
- Using it on a tiny time frameIchimoku was built for daily charts. On 1-minute charts the lines change constantly and the cloud means much less.
- Forgetting that the cloud is shiftedThe cloud in the future is not a forecast. It is today’s numbers drawn ahead, so you can see where those levels will sit.
- Treating a thin cloud like a thick oneA thin cloud is easy to break through. A thick one has seen a wide range of prices and is often a stronger zone.
- Reading only one lineIchimoku is meant to be read as a whole. One line on its own gives a lot of false signals.
Settings most people use
The numbers in brackets you see on charts – explained in plain words.
- Classic9, 26, 52Hosoda’s original settings, used by almost everyone. The shift is 26.
- Crypto variants10, 30, 60 or 20, 60, 120Some crypto traders lengthen the settings because crypto trades seven days a week. The classic settings remain the most common.
- Time frameDaily and weeklyThe cloud is most respected on daily and weekly charts.
How to use the Ichimoku cloud (for beginners)
Six small steps. None of them tells you to buy or sell – they help you read the chart.
- 1Find the cloudIs the price above, inside or below it? That is your weather.
- 2Check the thicknessThick cloud = a strong zone. Thin cloud = easier to cross.
- 3Look aheadIs the cloud 26 candles ahead green or red? That is the current balance.
- 4Compare the fast and slow linesTenkan above Kijun = short-term momentum up.
- 5Count the agreementsThe more lines agree, the clearer the trend.
- 6Stay on bigger chartsStart on the daily chart. Smaller charts come later.
See the Ichimoku cloud on other markets
Indicators work the same way on crypto, gold, currencies and stocks. Open any live Kumo chart and press the button.
Learn next
These go well together with this lesson.
Ichimoku cloud FAQ
What does Kumo mean in Ichimoku?
Kumo is Japanese for cloud. It is the shaded area between Senkou Span A and Senkou Span B. Our mascot Kumo is named after it.
What does it mean when price is above the Ichimoku cloud?
That the price is higher than the midpoints of the recent 26 and 52-candle ranges, so the trend has been up. Many traders see the cloud below as a support zone.
What do the green and red clouds mean?
Green means Span A is above Span B: the faster midpoints are above the 52-candle midpoint. Red means the opposite. Colours are a convention – some platforms use other colours.
What are the best Ichimoku settings for crypto?
Most people keep the classic 9, 26 and 52. Some crypto traders use 10, 30, 60 or 20, 60, 120 because crypto never closes. There is no proof that one is better for everyone.
Is Ichimoku good for beginners?
The basic idea – above the cloud is up, below is down, inside is unclear – is easy. The full system takes longer. Start with the cloud and add the other lines one at a time.
Who invented the Ichimoku cloud?
Goichi Hosoda, a Japanese journalist writing as “Ichimoku Sanjin”. He developed it over decades and published it in 1969.
All indicator lessons
Free, plain-word lessons, each with a live Bitcoin example.
- Support and resistanceThe price “floors” and “ceilings” where buyers or sellers stepped in before.
- Moving averages (SMA vs EMA)A smooth line through the price that shows which way the trend is going.
- RSIA 0–100 score of how hard a market has been bought or sold lately.
- VolumeHow much was traded – it tells you how many people stand behind a move.
- EMA 200The famous long-term trend line: above it the big picture is up, below it down.
- MACDTwo averages chasing each other – it shows when a move speeds up or slows down.
- Bollinger BandsA stretchy band around the price that shows normal and unusual moves.
- Stochastic oscillatorWhere today’s price sits inside its recent high–low range, from 0 to 100.
Written by
Alex Wu
Crypto, DeFi, perps and FX · driven by data
Alex designed the Kumocast model behind these signals, sets its rules, reviews its accuracy record and updates the methodology whenever the model changes. Signals are refreshed every 30 minutes with live market data.