Ichimoku Target Price Theory V, N, E and NT Calculations

12 may 2023

THE BASICS:

Here is a close up of the Ichimoku Kinkō Hyō indicator:



Many people do not know that the Ichimoku Kinkō Hyō cloud system has its own Number, Wave, Target Price and Timespan Theories. After years of study, the numbers that Goichi Hosoda choose for his system are 9, 17, 26 as the basic numbers with 33, 42, 65, 76, 129 and 200~257. These numbers are used in the timespan as well as on the indicator itself.

9 is used for the Conversion Line (Tenkan Sen)

26 is used for the Base Line (Kijun Sen)

26 is also used for the Lagging Span (Chikou Span) and is used to shift the current price back 26 periods. The Lagging Span (Chikou Span) is an exceptional part of the system and allows you to see possible support and resistance levels without drawing any lines.

The Leading Span A (Senkou Span A) is calculated using the Conversion Line (Tenkan Sen) and Base Line (Kijun Sen) values and is then plotted 26 periods into the future and shows potential future support and resistance levels.

The Leading Span B (Senkou Span B) is calculated using double of 26 so 52 periods and is then and is then plotted 26 periods into the future. This also shows potential future support and resistance levels.

Note that:
The Area ABOVE the cloud is called the BULLISH ZONE.
The Area BELOW the cloud is called the BEARISH ZONE.
The Area IN BETWEEN the Leading Span A (Senkou Span A) and Leading Span B (Senkou Span B) levels is called the EQUILIBRIUM ZONE.

Note that the Conversion Line (Tenkan Sen) and Base Line (Kijun Sen) ARE NOT MOVING AVERAGES but are instead calculated high and low midpoints of the price. So the Conversion Line (Tenkan Sen) is high and low calculated midpoint for the last 9 Periods (short-term) and the Base Line (Kijun Sen) is high and low calculated midpoint for the last 26 Periods (mid-term).


THE ADVANCED:

Ichimoku Kinkō Hyō Target Price Theory with examples:

How accurate is Goichi Hosoda’s Target Price Theory? Using the history of the DJI/USD chart….. it turns out the calculation are very accurate.

Note that i have added in timespans from Hosoda’s numbers to see if there is a day of change on the Ichimoku numbers 9, 17, 26, 33, 42, 65, 76, 129 and 200~257. Note that you can be flexible with these numbers so if a day of change is 8 days instead of 9 or 77 days instead of 76 then that is fine with this system.

Ichimoku System has 4 Price Target Calculations called V, N, E and NT. A few of these we will see below. As you’ll see below, the calculations do change if they are POSITIVE or NEGATIVE.

If we look at the Positive N Calculation from the Monday 3rd August 1896 until Monday 6th sept 1897 we can see that it was spot on.

N Calculation positive



N = C + (B-A) = D

(B) $32.55 - (A) $20.77 = $11.79

(C) $27.79 + (B-A) $11.78 = (D) $39.57

The actual price it went to was $40.41


If we look at the above Negative V Calculation from the Monday 29th Sept 1929 until Monday 5th sept 1931 we can see that again, the calculation was spot on.

V Calculation Negative



V = B - (C-B) = D

(C) $302 - (B) $194 = $108

(B) $194 - (C-B) $108 = (D) $86

The actual price it went to was $85.76 and continued to $40.72


If we look at this Negative N Calculation from the Monday 9th November 1931 until Monday 30th May 1932 we can see that again, it was almost spot on.

N Calculation Negative



N = C - (A-B) = D

(A) $118.86 - (B) $69.85 = $48.75

(C) $89.87 - (C-B) $48.75 = (D) $41.12

Actual = $43.52 and continued to $40.72


If we look at the Positive V Calculation from Monday 4th July 1932 until Monday 17th July 1933 we can see that again, it was almost spot on.

V Calculation Positive



V = B + (B-C) = D

(B) $81.63 - (C) $48.81 = $32.82

(B) $81.63 + (C-B) $32.82 = (D) $114.45

Actual = $110.90


If we look at the Negative V Calculation from Monday 4th Nov 1940 until Monday 13th April 1942 we can see that again, it was almost spot on.

V Calculation Negative



V = B - (C-B) = D

(C) $131 - (B) $114 = $17

(B) $114 - (C-B) $17 = (D) $97

Actual = $92.60


If we look at the Positive NT Calculation from Monday 23rd March 2020 until Monday 10th May 2021 we can see that again, it was spot on.

NT Calculation Positive



NT = C + (C-A)

(C) $26,114 - (A) $18,217 = $7,897

(C) $26,114 + (C-A) $7,897 = $34,011

Actually price went up to $36,971 which was until Monday 3rd Jan 2022.

If we look at the Negative V Calculation from Monday 12th Dec 2022 until Monday 13th March 2023 we can see that again, it was close but off from about $600 but still would’ve made a profit.

V Calculation Negative



V = B - (C-B) = D

(C) $34,344 - (B) $32,582 = $1,762

(B) $32,582 - (C-B) $1,762 = (D) $30,820

Actual price went to = $31,428


I have done these examples on the 1 week chart but this system also work for lower timeframes. I could go through and add much more calculations but i think you get the point with just these few. I hope this post has been helpful and insightful.


For those interested, below are 2 links to my previous post about Ichimoku Kinkō Hyō that you may find helpful.

Ichimoku Wave Theory:

Ichimoku Crypto:

12 may 2023

Nota

For those interested, here are the calculations for both Negative and Positive price directions.
V Calculation: V = B + (B-C) for Positive and V = B - (C-B) for Negative.
N Calculation: N = C + (B-A) for Positive and N = C - (A-B) for Negative.
E Calculation: E = B + (B-A) for Positive and E = B - (A-B) for Negative.
NT Calculation: NT = C + (C-A) for Positive and NT = C - (A-C) for Negative.

12 may 2023

Nota

Finally found the elusive E Calculation on a lower timeframe. If we look at the Negative E Calculation from Tuesday 16th August 2022 until Tuesday 6th September 2023 we can see that again, it was spot on and even dropped lower than the Price Target.

E Calculation Negative



E Calculation Negative E = B - (A-B)

(A) $34,276 - (B) $32,825 = $1,451

(B) $32,825 - (A-B) $1,451 = £31,374

Actual Price went to $31,047


Note that that i am saying V, E, N and NT = but you may read some publications saying D = this is still ok as as D is the potential Price Target. Personally i like using V, E, N and NT = but that's just me.

I hope this post has been helpful.