IFTA 23rd Annul Conference Fridy, Octoer 8, 2010 Border Line Pttern for the Ichimoku Kinko Hyo (Cndlestick Chrt) - Positioning with Bse Lines nd Timing for Time-Bsed Loss Cutting- 1 Yukitoshi Higshino, MFTA
Five Fctors of the Ichimoku Kinko Hyo (hereinfter Cndlestick Chrt) (P) 1250 1200 1150 1100 S&P500 (dily chrt: June 2009 to August 2010) Conversion line, se line, leding spn 1, leding spn 2, nd lgging spn re the five fctors of the cndlestick chrt, nd chrt showing those five fctors is the kinko hyo (equilirium chrt). Conversion line April 1219.80 Leding spn 1 Aug. 9 1129.24 1050 1000 950 Fe. 5 1044.50 Leding spn 2 July 1 1010.91 900 850 July 8 Bse line Lgging spn 869.32 800 2009/6 2009/6 2009/7 2009/8 2009/9 2009/10 2009/11 2009/12 2010/1 2010/2 2010/3 2010/4 2010/5 2010/6 2010/7 2010/8 2010/9 2010/9 2
Idel Top nd Bottom Pttern in Cndlestick Chrt Doule ottom Doule top c d The idel period from low price to nd from high price c to d is within dys. Why? 3
Bottom Pttern Shifting from Fll to Rise Ⅰ Stock price Within dys from the expected low "," the price goes ove to efore turning upwrds. Ⅱ Ⅲ Within dys from the expected low "," the price goes elow "" to "" efore turning upwrds. Strting from the expected low "," the price flls to "" which is higher thn nd then rises, ut in period tht exceeds dys. 4
Ceiling Pttern for Shifting from Rise to Fll Ⅰ c d The price goes to lower d thn the expected high "c" within dys nd then goes down. d Ⅱ c The price goes to the higher d thn the expected high "c" within dys nd then goes down. Ⅲ c d The price does not exceed the expected high "c" nd goes down fter hitting "d" ut in period of over dys from "c." 5
Importnt Points in Bse line nd Lgging Spn Border line - The idel top-ottom pttern tht introduces the dily chnge concept of dys from the se line to the lgging spn. Bse line: the middle price etween the highest nd lowest price in the pst dys including the current dy (highest price in period of dys + lowest price in period of dys) 2 Lgging spn: current dy s closing price projected into the pst y dys including the current dy 6
Wht is the Bse Line? 6600 6400 DAX nd se line (dily chrt: Mrch 2010 to August 2010) April 6341.52 dys 6200 6000 5800 5600 5400 2010/3 2010/3 2010/4 2010/5 My 25 5607.68 2010/6 July 5 5809.37 * used here is the importnt sic vlue in the concept of the kinko hyo (cndlestick chrt). 2010/7 Bse line (highest + lowest in the pst dys)/2 On the following dy, the sme clcultion is conducted y including the prices of the new dy ut excluding the prices of the oldest dy in the se line clcultion period. 2010/8 2010/9 2010/10 7
Wht is the Lgging Spn? SX5E nd lgging spn (dily chrt: My 2009 to August 2010) 3200 3000 Upturn Downturn Jn. 11 3044.37 April 16 3027.14 Downturn Aug. 5 2849.45 2800 00 2400 Nov. 3 93.80 Fe. 8 17.77 Upturn My 25 2200 2000 2448.10 A line connecting dily vlues in the pst dys including tody s closing * used here is the importnt sic vlue in the concept of the kinko hyo (cndlestick chrt). 2009/5 2009/6 2009/7 2009/8 2009/9 2009/10 2009/11 2009/12 2010/1 2010/2 2010/3 2010/3 2010/4 2010/5 2010/6 2010/7 2010/8 2010/9 2010/10 8
Wht the se line mens in the order line. Bse line: (highest in dys + lowest in dys) 2 Ⅰ Ⅱ Ⅲ Bse line Stock price When the price mkes n upturn within dys from the expected low "," the se line goes up in dys from the expected low "," nd therefore stock prices tend to go up. When the price goes elow the expected low "" within dys from "," the se line cnnot go up nd provides resistnce to the increse in stock prices, which increses the possiility of the price going down. When the price does not go down elow the expected low "" nd mkes n upturn fter period of dys, the se line moves sidewys nd then drops to ecome resistnt to the rising of stock prices. 9
The softer the downtrend, the stronger the mrket (se line). Why is tht? Stock price Ⅰ Bse line When dip to "" is strong reltive to the expected low "," the leveling period of the se line tends to e extended. In tht period, if the stock price does not go ck up nd exceed the high, the high of the se line during the clcultion period ecomes lower, therey cusing the se line to drop gin. Ⅱ When dip to "" is wek reltive to the expected low "," it is reltively more likely tht the price will go up ove the recovery high. Therefore, the high of the se line during the clcultion period go higher, nd the uptrend of the se line continues, mking it likely to crete stronger mrket. 10
Wht the lgging spn mens in the order line. Lgging spn: current dy s dily closing price projected into the pst y dys Ⅰ Ⅱ Lgging spn Stock price When the price mkes n upturn within dys from the expected low "" fter hitting "," then the lgging spn exceeds the stock price. (upturn or uy signl). When the price hits "," which is lower thn the expected low "" within dys from "," then the lgging spn remins elow the stock price. (continued downturn or sell signl). Ⅲ When the price does not go down elow the expected low "" ut tkes n upturn fter hitting "" in period of over dys from "," the lgging spn is highly likely to go down elow the stock price gin. (downturn fter upturn, sell signl). 11
The softer the downtrend, the stronger the mrket (lgging spn). Why is tht? Stock price Lgging spn Ⅰ When the dip to "" is strong reltive to the expected low "," the lgging spn tends to touch the stock price of dys go nd thus is more likely to fll elow the stock price. There is high possiility of ecoming downturn. Ⅱ When the dip to "" is soft reltive to the expected low "," the lgging spn tends not to touch the stock price of dys go nd is thus reltively less likely to fll elow the stock price. There is low possiility of ecoming downturn. 12
Bsic Pttern for the Border Line The order line is composed of the idel ptterns of the lgging line nd the se line. Stock price Lgging spn Bse line c d An idel cse is tht the line does not go down elow the se line nd mkes n upturn in out dys from the second lowest ottom. An idel cse is tht the line does not go up ove the se line ut drops gin out dys from the second highest pek. 13
The Strong Border Line Pttern nd the Temporl Loss Cut The vlue goes ove or flls elow the recovery high or the immedite low within dys. The se line continues to rise, nd the stock price shows strong up trend. Stock price Lgging spn Loss cutting due to the fll of the se line Bse line c d Loss cutting due to the rise of the se line The se line continues to fll, nd the stock price shows strong down trend. 14
E Clcultion fter the Border Line (Setting of the Trget) 3E E 850 800 1000 950 900 50 800 750 E 3E 50 700 650 600 A rise from the second lowest ottom or drop from the second highest pek is often ccompnied y gp. Doule of the increment or decrement of the initil move ecomes n equilirium point. 15
Equilirium Point is the Arrngement of the Lterl Axis nd Verticl Axis. Bsic vlues (9, 17,, 33, 42, 51, 65, 76, 83, 97, 101, 129 ) 42 65 76 Equilirium point (importnt chnge dy) Stock price No. of dys Equivlent vlues 2 53+29-1 3 29+88-1 116 168 3 4 88 4 53+29+88-2 29 53 168 (53+29+88-2) 53 81 1 2 Equilirium point (importnt chnge dy) Stock price No. of dys 16
Time Theory (Concept of Equivlent Vlue) I I I V I N V I V V V N N I N V N N 17
Itochu Corp. (8001, dily chrt) Jnury 2003 to Novemer 2003 65 64 348 39 52 347 351 39 39 Low within dys 18
Nomur Holdings, Inc. (8604 dily chrt) Novemer 2002 to Septemer 2003 89 90 1803 179 1800 179 179 179 19
Mrueni Corp. (8002 dily chrt) 102 102 102 102 102 102 High within dys Mrch 2008 to Mrch 2009 102 274 129 0 20
AAPL UW (dily chrt Fe. 2008 to April 2009) ($) 200 180 48 48 My 14, 2008 192.24 19.73 Ferury 2008 to April 2009 160 140 19.73 152.78 152.91 19.73 120 19.73 Sept. 18, 2008 100 19.73 120.70 80 60 73.86 19.73 173 Jn. 20, 2009 78.20 08/2/1 08/3/3 08/4/1 08/4/29 08/5/28 08/6/25 08/7/24 08/8/21 08/9/19 08/10/17 08/11/14 08/12/15 09/1/14 09/2/12 09/3/13 09/4/10 09/4/30 21
Sumitomo Metl Mining (5713 dily chrt ) 150(08.3.24) 151 16 1632 45 46 270 77 270 1092 1079 1095 270 270 August 2008 to July 2009 22
Sumitomo Metl Mining (5713 dily chrt ) My 2010 to Septemer 2010 23
NTT DOCOMO(9437 dily chrt ) Octoer 2009 to August 2010 24
Deutsche Bnk ( dily chrt ) 70 60 50 Octoer 2008 to Septemer 2010 58.37 8.6 49.78 2009.7.27 2009.6.5 52.60 49.62 2009.10.15 58.29 2010.4.15 60.55 8.6 40 8.6 30 8.6 20 10 2009.1.21 15.38 8.6 95 189 08/10 08/11 08/12 09/2 09/3 09/5 09/6 09/8 09/9 09/10 09/12 10/1 10/3 10/4 10/6 10/7 10/8 10/10 25
SAP( dily chrt ) 43 41 2007.9.21 42.08 1.97 August 2007 to Mtch 2008 39 1.97 37 1.97 35 1.97 33 1.97 31 1.97 29 27 28.29 1.97 83 2008.1.22 28.31 07/8 07/8 07/8 07/9 07/9 07/10 07/10 07/11 07/11 07/12 07/12 08/1 08/1 08/2 08/2 08/3 08/3
Nomur Holdings, Inc. (8604 dily chrt) Mrch 2010 to Septemer 2010 27
Mizuho Finncil Group(8411 dily chrt ) Mrch 2010 to Septemer 2010 28
Cution This report is intended to provide informtion tht helps the user to mke proper investment judgments nd does not im to promote prticulr investments. The dt contined in this report re sed on relile informtion, ut we do not gurntee the correctness or integrity of the dt. The informtion contined in this report is ment for your own use. It is prohiited for this report to e provided or redistriuted to ny third person, or modified or chnged in ny wy. It is lso prohiited tht copies or modified versions of this report e ssigned or trnsferred to or used y ny third person. 29 T&C Finncil Reserch,Inc. Yukitoshi Higshino y_higshino@tndcfr.com