Elder Impulse System
The Impulse System was first described in "Come into my Trading Room" book. It uses the direction of both the MACD-Histogram and an exponential moving average (EMA) of price to define an impulse. The rule is never to trade against the impulse.
Its color code gives you several signals:
- When both the EMA and MACD-Histogram are rising, the Impulse system colors the bar color is green (no shorting permitted).
- When both the EMA and MACD-Histogram are falling, the Impulse system colors the bar color is red(no buying permitted).
- When the EMA and MACD-Histogram are pointing in different directions, the Impulse system colors the bar color is cyan (you may go long or short).
- MACD_Short_Length (12) – The short EMA for the MACD calculation;
- MACD_Long_Length (26) – The long EMA for the MACD calculation;
- MACD_Smoothing_Length (9) – The smoothing value for the Signal line;
- Short_EMA_Length (13) – The short-term price EMA.