Can the Ichimoku Cloud Strategy Indicator Be Profitable?

Does the Ichimoku Cloud indicator trading strategy even work? Are online trading gurus telling you false information? I have wasted years testing every trading strategy out there before I found the right one that worked! I’ve created this channel to expose every strategy and show their real probabilities so you don’t have to waste your precious time like I did! I’m not here to sell any kind of online course; I’m just here to help you in your stock trading and Forex trading career.

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In this video, I will back-test a very famous trading strategy called the Ichimoku Cloud strategy 100 times.

Yes, you heard it right. Testing 100 times takes time and will most likely prove whether you should risk your hard-earned money using this strategy! This video will be very similar to the RSI and MACD videos I made a while ago. If you want to know if those strategies work after testing 100 times, check those videos out.

What Is the Ichimoku Cloud Indicator?
If you are new to trading, don’t get scared away after looking at this indicator. On TradingView, the Ichimoku Cloud indicator will look something like this. I know, it looks like a big mess.

I have already made a video on the basics. If you have never heard about this indicator, check out my previous video where I explain this indicator in detail. If you remember, in my last Ichimoku Cloud video, I said this green lagging span was optional, and most traders don’t use it. In this video, I have not used it to backtest because it makes things more confusing.

The Ichimoku Cloud indicator comes with five lines: a blue line called the conversion line, a red line called the base line, a green line called the lagging span, and two other lines that form the Cloud.

Modified Ichimoku Cloud Trading Strategy
The Ichimoku Cloud trading strategy is really simple, but in the last video, we modified it to filter false signals. Here’s how the modified strategy works:

Long Setup: If the price is above the Cloud and also above the 200-period moving average, and the blue line is crossing above the red line, we will buy as soon as the crossover happens. Set your stop loss just below the base line.
Short Setup: If the price is below the Cloud and also below the 200-period moving average, and the blue line is crossing below the red line, we will sell as soon as the crossover happens. Set your stop loss just above the base line.
Important Changes to Improve Win Rate
Here are a few more important changes I found that will improve the win rate of this strategy and make it less confusing:

Make the Cloud Opaque: This way, you won’t see the candles that form inside the Cloud. Our strategy says not to take trades when the price is inside the Cloud.
Remove the Lagging Span: Use the 200-period moving average instead. The Cloud shows the trend direction, but the 200-period moving average helps filter false signals and find the direction of the long-term trend.
Real Profit Potential of the Ichimoku Cloud Strategy
So, the question is: If you enter trades using the Ichimoku Cloud indicator, will you become a profitable trader?

In the next few minutes, I will show you how the profit graph looks after taking 100 trades, the real winning percentage of the Ichimoku Cloud strategy, and how many losers you can expect in a row. I will fast forward the next clip to save your time. The following clip can help you understand how this strategy looks in different market conditions, so do watch carefully.

If you want to know about the best MACD trading strategy that I back-tested 100 times to see if that strategy is profitable or just fake, check out the first video on this channel. And check out other strategies that I tested 100 times, like the CCI and Bollinger Bands.

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