About the Icho Trend Indicator
The Icho Trend Indicator is a specialized technical tool developed for the Metatrader 4 platform, designed to simplify trend identification through a clean bar-based interface.
It functions by analyzing price momentum over a specific period to determine the prevailing market bias.
When the sentiment shifts from bearish to bullish, the indicator transitions its output to reflect the new direction.
One of the primary advantages of the Icho Trend Indicator is its ability to filter out minor market noise, allowing traders to stay focused on the core trend.
It is particularly effective for those who engage in fast-paced trading environments like scalping or day trading.
By utilizing a period-based calculation, it identifies swing highs and lows to generate timely signals.
This makes it an essential asset for traders who want to capitalize on volatility during peak market hours without overcomplicating their charts.
Free Download
Download the “icho-trend-indicator.mq4” MT4 indicator
Key Features
- The indicator plots color-coded bars directly on the main chart.
- It identifies real-time trend shifts for immediate entry.
- The TM period setting allows for easy sensitivity adjustments.
- The tool is optimized for M5 and M15 scalping strategies.
- It delivers distinct signals during volatile trading sessions.
- The layout helps traders make faster decisions under pressure.
Indicator Chart
The chart displays the Icho Trend Indicator applied to a currency pair, showing a series of blue and red bars.
The blue bars appear below the price candles to indicate a bullish phase, while the red bars sit above the candles to signify a bearish trend.
This visual arrangement helps traders quickly distinguish between buying and selling zones as the market fluctuates.
Guide to Trade with the Icho Trend Indicator
Buy Rules
- Wait for the Icho Trend Indicator to print a blue bar below the price candlestick.
- Ensure the current candle closes to confirm the signal remains in place.
- Enter a long position at the opening of the next candle.
- Verify the market is in an active session for better momentum.
Sell Rules
- Look for the Icho Trend Indicator to draw a red bar above the price candlestick.
- Confirm that the red bar is locked in upon the candle close.
- Initiate a short trade at the start of the following candle.
- Focus on trades that align with the broader market direction.
Stop Loss
- Position the stop loss a few pips below the most recent swing low for buy orders.
- Place the stop loss a few pips above the most recent swing high for sell orders.
- Adjust the exit point if the market volatility increases significantly.
Take Profit
- Close the trade when the indicator generates a signal in the opposite direction.
- Exit for a profit when a red bar appears during a long trade.
- Exit for a profit when a blue bar appears during a short trade.
- Consider a 1:2 risk-to-reward ratio for consistent account growth.
Icho Trend + Auto Trend Forecaster MT4 Forex Strategy
This forex strategy combines the Icho Trend Indicator for MT4 and the Auto Trend Forecaster Indicator for MT4.
The Icho Trend Indicator provides clear buy and sell signals.
A blue bar below the candlestick signals a buy, while a red bar above the candlestick signals a sell.
The Auto Trend Forecaster adds trend confirmation: a blue line indicates bullish conditions and a red line indicates bearish conditions.
By combining these indicators, traders get clear entry points with trend confirmation, reducing false trades and improving accuracy.
This strategy works well on M15 and H1 charts for day trading.
It is suitable for major currency pairs and high-liquidity sessions.
The combination of bar-based signals and trend line confirmation allows traders to follow the trend while entering at optimal points for higher probability trades.
Buy Entry Rules
- Icho Trend Indicator draws a blue bar below the candlestick, signaling a buy.
- The Auto Trend Forecaster line is blue, confirming a bullish trend.
- Enter a buy trade after the candle with the blue bar closes.
- Place a stop loss below the recent swing low or below the low of the signal candle.
- Take profit at the next resistance level or after a reasonable pip gain based on volatility, typically 30–50 pips on H1 or 15–25 pips on M15.
Sell Entry Rules
- Icho Trend Indicator draws a red bar above the candlestick, signaling a sell.
- The Auto Trend Forecaster line is red, confirming a bearish trend.
- Enter a sell trade after the candle with the red bar closes.
- Place a stop loss above the recent swing high or above the high of the signal candle.
- Take profit at the next support level or after a reasonable pip drop based on volatility, typically 30–50 pips on H1 or 15–25 pips on M15.
Advantages
- Clear and easy-to-read signals for both entries and trend confirmation.
- Reduces false trades by confirming signals with trend direction.
- Works on multiple timeframes for flexible day trading.
- It can be applied to major currency pairs with high liquidity.
- Helps traders stay with the trend while entering at optimal points.
Drawbacks
- Limited signals in sideways or low-volatility markets.
- Requires careful monitoring to avoid entering before trend confirmation.
Example Case Study 1
On EURJPY H1 during the London session, the Icho Trend Indicator displayed a blue bar below the candlestick at 156.82.
The Auto Trend Forecaster line was blue, confirming bullish momentum.
A buy trade was placed at 156.84 with a stop loss at 156.60.
Price climbed to 157.20 within three hours, giving a profit of 36 pips before a trend reversal signal appeared.
Example Case Study 2
On AUDUSD M15 during the New York session, the Icho Trend Indicator drew a red bar above the candlestick at 0.6615.
The Auto Trend Forecaster line was red, confirming bearish momentum.
A sell trade was entered at 0.6614 with a stop loss at 0.6625.
Price declined to 0.6598 over the next 45 minutes.
The trade was closed for a gain of 16 pips before any trend change appeared.
Strategy Tips
- Focus on trading major currency pairs with high liquidity, as they produce smoother trends and more reliable signals.
- Enter trades only when both the Icho Trend bar and the Auto Trend Forecaster line confirm the direction, avoiding impulsive entries.
- Use higher timeframes, such as H1, to filter out market noise and reduce false signals, while M15 can be used for faster opportunities.
- Place stop losses strategically below swing lows for buys and above swing highs for sells to protect your account without being too tight.
- Take profits near significant support and resistance levels or when a clear signal of trend exhaustion appears to maximize gains.
- Keep a trading log to track performance, noting which pairs, times, and conditions generate the best results for this strategy.
- Stay disciplined and do not chase trades; wait for proper alignment of both indicators to maintain a high probability approach.
Download Now
Download the “icho-trend-indicator.mq4” Metatrader 4 indicator
FAQ
What is the best time to use the Icho Trend Indicator?
The Icho Trend Indicator performs at its peak during the London and New York trading sessions.
Can I change the sensitivity of the signals?
Yes, you can modify the sensitivity by accessing the inputs tab and changing the TM period.
The default value is 7, which is balanced for intraday trading.
Increasing this number will make the indicator slower and more stable, while decreasing it will make it more responsive to small price changes.
Summary
The Icho Trend Indicator is a highly efficient tool for any trader looking for a straightforward way to capture market momentum.
Its primary benefit lies in its simplicity, as it removes the guesswork from trend analysis by providing clear color-coded signals.
To maximize its potential, it is recommended to pair it with a solid risk management plan and focus on high-volume sessions.
