Ichimoku + Fibonacci + Volume Combo

Entry Logic

• Long entry: Price pulls back to the Ichimoku Kijun-Sen, which aligns with a 61.8% Fibonacci retracement level. Entry on a bullish candle with above-average volume.
• Short entry: Price rallies to the Ichimoku Kijun-Sen, which aligns with a 61.8% Fibonacci retracement level. Entry on a bearish candle with above-average volume.
• Confirmation: The Tenkan-Sen should be above the Kijun-Sen for longs, and below for shorts.
• Timeframe: 1-hour chart.
• Location: At the confluence of the Kijun-Sen and a Fibonacci level.
• Market Condition: Trending market.

Exit Logic

• Profit Target: The previous swing high for longs, swing low for shorts, or 2.5R.
• Scaling Out: Scale out 33% at 1R, 33% at 2R.
• Trailing Stop: Trail stop on the opposite side of the Ichimoku cloud.
• Signal Failure: Exit if price closes back across the Kijun-Sen.
• Opposite Signal: Exit on a Tenkan-Sen/Kijun-Sen cross against the position.
• Time Expiration: Exit if the trade is not profitable within 12 hours.
• Momentum Loss: Exit if the move stalls and volume diminishes.

Stop Loss Structure

• Hard Stop: Below the Ichimoku cloud for longs, above for shorts.
• Soft Stop: A close back across the Kijun-Sen.
• Max Dollar Loss: $250 per trade.
• Max Percent Loss: 1.25% of account.
• Structural Stop: Below the swing low that the Fibonacci retracement was drawn from.

Risk Management Framework

• Risk Per Trade: 1.25% of account.
• Daily Limit: 1 losing trade.
• Weekly Limit: 3% drawdown.
• Max Drawdown: 7%.
• R:R Requirement: Minimum 2:1.

Position Sizing Model

• Sizing Approach: Fixed fractional, 1.25% of account at risk.
• Volatility Adjustment: The stop loss is naturally volatility-adjusted by the cloud.
• Conviction Sizing: Not recommended.
• Scaling In: Not recommended.
• Scaling Out: Scale out at 1R and 2R.

Trade Filtering

• Market Conditions: Only trade in clear, trending markets as defined by the Ichimoku cloud.
• Setups: Must have a clean confluence of Kijun-Sen and a Fibonacci level.
• Instruments: Forex pairs, indices, and liquid stocks.
• Time Restrictions: Any time.
• Chop/News Avoidance: Avoid trading when price is inside the cloud (Kumo).

Context Framework

• Trend Direction: Defined by the Ichimoku cloud. Price above cloud is uptrend, below is downtrend.
• VWAP Relationship: Not a primary component.
• MA Relationship: The Ichimoku system is a complete trend-following system on its own.
• Range Location: Not applicable, this is a trend-following strategy.
• Higher TF Alignment: The daily chart should also show a clear trend with price on the correct side of the cloud.

Trade Management Rules

• Breakeven: Move stop to breakeven after the first scale out at 1R.
• Scale Out: Scale out at 1R and 2R.
• Add Size: Not recommended.
• Fast vs Slow Moves: Let the trade develop, the trailing stop will handle it.

Time Rules

• Optimal Window: Any time, as long as there is a clear trend.
• Times to Avoid: When price is inside the cloud.
• Session Notes: Works well on higher timeframes, so session timing is less critical.

Setup Classification

• A+ Setup: Perfect confluence, strong trend, and alignment on the daily chart.
• A Setup: Good confluence and a clear trend.
• B Setup: Confluence is not perfect, or the trend is weak.
• C Setup: Price is inside the cloud, or no clear trend.

Market Selection Criteria

• Instruments: EUR/USD, GBP/USD, USD/JPY, SPX, NDX.
• Volume: Must have good liquidity.
• Volatility: Moderate to high volatility is best.

Statistical Edge Metrics

• Win Rate: 55%.
• Avg Win: 2.5R.
• Avg Loss: 1R.
• Profit Factor: 1.92.
• Expectancy: 0.6R per trade.

Failure Conditions

• Market Conditions: Fails in range-bound, choppy markets.
• Specific Scenarios: Fails when the trend suddenly reverses.

Psychological Rules

• Mental Discipline: Requires patience to wait for the setup and discipline to follow the system's rules.

Advanced Components

• Regime Detection: The Ichimoku system has its own built-in regime filter (the cloud).
• Filters: Not needed.
• Correlation: Be aware of correlations between forex pairs.
• MTF Alignment: Crucial for this strategy. Daily and 4-hour charts should be aligned.

Location

• Strongest: In a textbook trend with clear pullbacks.
• Weakest: In a choppy, directionless market.