Key takeaways
- The downward cloud break is the one signal that works. +1.8 points at a 1:2 target, significant.
- The upward cloud break is flat. Slightly negative at a 1:1 target - the mirror trade is not there.
- The Tenkan/Kijun cross is not significant in either direction on daily charts, despite thousands of occurrences.
- Complexity is not an edge. Five lines produced one usable signal; Supertrend produced a bigger one with a single line.
What it does
Ichimoku Kinko Hyo draws five lines. Tenkan-sen and Kijun-sen are midpoints of the last 9 and 26 bars' ranges. Senkou Span A is the midpoint of those two and Senkou Span B the midpoint of the last 52 bars, both plotted 26 bars into the future — the gap between them is the cloud. Chikou Span plots the close 26 bars back.
The forward displacement is the distinctive part: the cloud ahead of price is built from data already known, so it offers support and resistance levels before price arrives. We measure the two readings that carry most of the system's weight: the Tenkan/Kijun cross, and price breaking through the cloud in either direction.
How this was measured
Every figure below comes from our own tick-derived archive, not from a vendor summary. The method is identical to the one behind our indicator signal study, so the numbers here are directly comparable to every other signal we publish.
- Data. Dukascopy bid-side OHLC for 93 instruments — major and cross FX pairs, gold, silver, stock indices and crypto — from 2010 to August 2026.
- The trade. Enter at the open of the next bar. Stop at 1.5 × ATR(14), targets at 1:1 and 1:2, walking forward up to 40 bars.
- Ties go against you. A bar holding both stop and target is scored a loss every time.
- Real costs. Per-instrument median spreads from our own bid/ask measurement.
- The control. For every signal, a trade with the same direction and the same stop distance at a random bar — five draws each. The gap between the two columns is all the signal is worth.
The result
Cloud boundaries are displaced 26 bars forward, the standard Ichimoku reading. Breakeven is a 50% win rate at a 1:1 target and 33.3% at 1:2. "Matched random" is a trade in the same direction with the same stop distance, opened at a random bar.
| Signal | Target | Trades | Win rate | Matched random | Edge | Significance | Beats breakeven? |
|---|---|---|---|---|---|---|---|
| Tenkan/Kijun bull cross | 1:1 | 5,851 | 52.8% | 51.8% | +1.0 pts | not significant | Yes |
| Price breaks below cloud | 1:1 | 6,539 | 48.2% | 47.1% | +1.0 pts | not significant | No |
| Tenkan/Kijun bear cross | 1:1 | 5,789 | 47.6% | 46.9% | +0.7 pts | not significant | No |
| Tenkan/Kijun bull cross | 1:1 | 30,126 | 49.7% | 49.0% | +0.7 pts | * | No |
| Tenkan/Kijun bear cross | 1:1 | 29,925 | 48.2% | 48.1% | +0.1 pts | not significant | No |
| Price breaks below cloud | 1:1 | 31,958 | 48.4% | 48.4% | +0.0 pts | not significant | No |
| Price breaks above cloud | 1:1 | 32,737 | 48.9% | 49.1% | -0.2 pts | not significant | No |
| Price breaks above cloud | 1:1 | 6,679 | 51.2% | 51.5% | -0.3 pts | not significant | Yes |
| Price breaks below cloud | 1:2 | 6,271 | 31.1% | 29.3% | +1.8 pts | ** | No |
| Tenkan/Kijun bull cross | 1:2 | 28,903 | 33.3% | 31.8% | +1.6 pts | *** | No |
| Tenkan/Kijun bull cross | 1:2 | 5,588 | 36.2% | 35.1% | +1.1 pts | not significant | Yes |
| Price breaks below cloud | 1:2 | 30,819 | 31.6% | 30.5% | +1.1 pts | *** | No |
| Tenkan/Kijun bear cross | 1:2 | 28,895 | 31.4% | 30.4% | +1.0 pts | ** | No |
| Tenkan/Kijun bear cross | 1:2 | 5,528 | 30.1% | 29.3% | +0.7 pts | not significant | No |
| Price breaks above cloud | 1:2 | 31,533 | 32.7% | 32.0% | +0.6 pts | * | No |
| Price breaks above cloud | 1:2 | 6,389 | 35.0% | 34.6% | +0.3 pts | not significant | Yes |
The result is uncomfortable for a system whose appeal is its completeness. Of the four daily signals measured, one is significant. The Tenkan/Kijun cross — the entry trigger in most Ichimoku tutorials — produces about a point in either direction and does not reach significance on daily bars despite thousands of occurrences.
The downward cloud break is the exception, and it is interesting precisely because its mirror is not. Breaking below the cloud carries information; breaking above it does not. That asymmetry runs against the symmetry Ichimoku's construction implies, and it is the opposite direction from the long-side asymmetry seen in most other indicators here.
How to use it
- Use the cloud, not the cross. The cloud break is where the measured edge is; the Tenkan/Kijun cross did not reach significance.
- Downward breaks specifically. The upward break is flat to slightly negative at a 1:1 target.
- Keep the forward displacement. We measured the cloud displaced 26 bars forward, the standard reading. A cloud drawn at the current bar is a different indicator.
- Use the rest as context. Cloud thickness and position describe the regime perfectly well even though we could not measure an edge in the crosses.
What does not work
- The Tenkan/Kijun cross. Not significant in either direction on daily charts, despite being the headline entry in most Ichimoku material.
- The bullish cloud break. Flat at a 1:2 target and slightly negative at 1:1.
- Assuming a five-line system beats a one-line one. Supertrend produced a larger daily edge with a single volatility-scaled band.
Limitations
- Default parameters only. Tuning them on this same data would be curve-fitting.
- One stop rule (1.5 × ATR) and two fixed targets. Trailing stops, time exits and scaling are untested.
- Signals are taken in isolation, with no trend filter or confluence — which is how the isolated value of each is measured, but not how most people trade them.
- Bid data with modelled ask. Spread is a measured median, not a replayed tick-level ask feed.
- Spread only — no commission or swap. Both would push results further down.
- A statistically significant edge of one point is still only one point. Large samples make small effects certain; they do not make them large.
Cite or republish this data
Free to quote, screenshot, or republish — in an article, a video, a newsletter, or a course — as long as you credit FxBacktest with a link back to this page.
Frequently asked
Does Ichimoku work?
One part of it does. Price breaking below the cloud beat a matched random short with the same stop distance by +1.8 points at a 1:2 target on daily charts across 93 instruments, a significant result. The Tenkan/Kijun cross did not reach significance in either direction, and the upward cloud break was flat to slightly negative.
Is the Tenkan/Kijun cross a good entry signal?
Not on this evidence. It is the entry trigger in most Ichimoku tutorials, and across thousands of daily occurrences on 93 instruments it produced about a point of edge over a matched random entry without reaching statistical significance in either direction.
What is the Ichimoku cloud?
The area between Senkou Span A, the midpoint of the Tenkan and Kijun lines, and Senkou Span B, the midpoint of the last 52 bars. Both are plotted 26 bars into the future, so the cloud ahead of price is built entirely from data already known and offers support and resistance levels before price reaches them. We measured the standard 26-bar forward displacement.
Why does only the downward cloud break work?
We can measure the asymmetry but not explain it from this data alone. It is worth noting the direction is unusual: most indicators in this study perform better on the long side, partly because markets rose over the sample period. Ichimoku is the opposite, which at least means the result is not a simple drift artefact - the control column already removes that.
How were these Ichimoku numbers produced?
Enter at the open of the bar after the signal, stop 1.5 x ATR(14) away, targets at 1:1 and 1:2, walking forward up to 40 bars. Bars containing both stop and target are scored as losses. Real per-instrument median spreads are applied. Every signal is compared against five random-entry draws in the same direction with the same stop distance. Data is Dukascopy bid OHLC for 93 instruments, 2010 to August 2026.