Lesson 1 Overview: Ichimoku Beyond the Cloud

Most traders know Ichimoku as “five lines and a cloud.” But the real substance left behind by its creator, Ichimoku Sanjin (Goichi Hosoda), is three theories — Wave Theory, Time Theory, and Price-Target Theory. This advanced series covers all three pillars.

1. The Three Theories of Ichimoku

Theory	Core question	What it looks at
Wave Theory	What “shape” does price move in?	The wave structure of price
Time Theory	”When” does the change arrive?	Change days, base numbers
Price-Target Theory	”How far” does it go?	Target price ranges

2. Wave Theory — Reading the “Shape” of Price

Price looks chaotic, but it actually moves as a combination of a handful of basic wave forms. Wave Theory reads that “shape.”

Three basic waves:

I-wave: a single move in one direction (one leg up or down)
V-wave: a pullback pair — up then down (∧), or down then up (∨)
N-wave: a V-wave plus one more leg — the market’s foundational completed form

3. The N-Wave — The Basic Unit of Every Move

In Ichimoku, the basic unit of price action is the N-wave. An upward N-wave has a three-leg structure: rise → correction → renewed rise.

C (high)
/
A /
//
/ B (correction low) (start)

A (leg 1, rise) → B (leg 2, correction) → C (leg 3, renewed rise) = N-wave

Every larger wave is understood as a chain of smaller N-waves.
Moving from I → V → N, the market’s “degree of completion” increases.

4. How to Count Waves, and What It Means

Gauge how far a move has progressed by counting how many N-waves it contains
As wave 1 → wave 2 → wave 3… accumulate, the trend matures
When a wave’s “shape” breaks (e.g., it stalls at V instead of completing to N), that signals trend weakness

Wave Theory rarely trades well on its own — it gains real power when combined with Time Theory (when) and Price-Target Theory (how far).

5. Roadmap for This Series

Lesson	Topic
1	Overview of the three theories + Wave Theory (this lesson)
2	Time Theory — base numbers, corresponding numbers, change days
3	Price-Target Theory — V/N/E/NT target calculations
4	Advanced line reading + precise interpretation of bullish/bearish crosses
5	Three-role reversal in full practice, combined with other indicators

This Lesson’s Key Takeaways

Ichimoku’s essence isn’t the five lines and cloud — it’s the three theories: wave, time, and price.
Ichimoku Sanjin treated time as the true center of the market, more fundamental than price.
The basic waves are I (single leg), V (pullback), and N (three legs, the foundational completed form).
Convergence signals a P-wave; divergence signals a Y-wave — both foreshadow the next move.
Wave Theory gains its power when combined with Time Theory and Price-Target Theory.

Next lesson: We cover Time Theory, the heart of Ichimoku — the base numbers 9, 17, and 26, corresponding numbers, and how to calculate “change days” to estimate when the market is likely to turn.

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(Verified: June 2026)

Chart Analysis — Advanced Ichimoku ① — The Three Pillars and Wave Theory