What is Senkou Span A

Senkou Span A is one of five components constructed in an Ichimoku Kinko Hyo indicator. Senkou Span A is a line used to measure momentum and provide for signals showing support and resistance levels. It works in conjunction with the Senkou Span B line to form a cloud formation known as a kumo.

BREAKING DOWN Senkou Span A

The Senkou Span A line and Senkou Span B line are used together to form the cloud formation in an Ichimoku Kinko Hyo diagram. The Ichimoku Kinko Hyo diagram originated from Japan. It is a popular diagram for chartists because it offers multiple insights in one chart through five chart components. In addition to the cloud pattern formed from the Senkou Span A line and the Senkou Span B line, the Ichimoku Kinko Hyo also includes three other components: the Tenkan-Sen, the Kijun-Sen and the Chikou Span.

Cloud

The Senkou Span A line and Senkou Span B line create a cloud formation which is typically designated by a shaded area on an Ichimoku Kinko Hyo diagram. The cloud is charted 26 days ahead of the daily candlestick pattern to provide a forward-looking indicator for bullish and bearish signals.

The calculation for the Senkou Span A line integrates the Tankan-Sen and Kijun-Sen, two of the other chart components on the Ichimoku Kinko Hyo diagram. The Senkou Span A line is plotted 26 days ahead and calculated using the following equation:

Senkou Span A = (Tenkan-Sen + Kijun-Sen) / 2

The Senkou Span A line takes into consideration the highs and lows over a nine-day period while the Kijun-Sen considers highs and lows over a 26-day period. Senkou Span B is less complicated in its calculation simply considering the highest high and lowest low over a 52-day period.

Senkou Span B = (Highest High – Lowest Low) / 2

The Senkou Span B line is considered to be the slower of the two cloud lines as it considers 52 days. Generally, when the Senkou Span B takes the top position in the cloud it is considered a bearish signal. Adversely, when the Senkou Span A lines takes the top position in the cloud it is considered a bullish signal. These indicators are also commonly used to predict the reversal of a current trend which can be signaled when the two Senkou Span lines cross over each other.

Source: FXStreet

Other Ichimoku Kinko Hyo Indicators

The Ichimoku Kinko Hyo diagram also includes three other components: the Tenkan-Sen, the Kijun-Sen and the Chikou Span. Calculations for these components are noted below.

Tenkan-Sen: This line is calculated by using the following formula from a period of nine days:

Tenkan-Sen = (Highest High + Lowest Low) / 2

Kijun-Sen: Utilizes the following formula from a 26-day period:

Kijun-Sen = (Highest High + Lowest Low) / 2

Chikou Span: Trendline showing the closing price for the past 26 days.