Elder Impulse System - indicator for entry or exit
Elder Impulse System Indicator, which we will this time consider, partly reflects the Elder Impulse Trading System. Unfortunately, the author was miserly in describing his work, so in this article I will try to correct this mistake, because the Elder Impulse System (hereinafter EIS) is very interesting and tempting indicator .
Fig. 1. Elder Impulse System indicator on the chart.
As a trader with a trained eye will immediately see, the algorithm of work on the indicator is quite simple: when the EIS is colored in green, there is a bullish momentum when it takes red color, fix the bearish movement. If blueThis means that the candle (formed) either has a low tick volume or the so-called "Inner Bar", or indicates a flat.
More about the Elder Impulse System indicator
Indicator signals are also clear: green bar - buy, red bar - sell, blue bar - rest. But that's not the case. Let's look at a specific example (see Fig. 2). The red arrow indicates the candle at which we sold the asset. The cross indicates the candle at which we closed the position. But after a while trend went in our direction again. The blue arrow marks the bar at which we went "short" again, but we missed a good bearish candle (indicated by a check mark).
Fig. 2 Example of the Elder Impulse System indicator on the chart.
We exited the position guided by the blue bar of the EIS, which misled us about the change in the trend. And this situation is a good example of the fact that trading with this indicator allows us to see quite good moments for fixing profit share or transferring a position in the Breakeven with the appearance of the blue bar.
Blue bar - the best bar of the Elder Impulse System indicator
It is the blue bar that I consider the main advantage of the EIS indicator, for example, in comparison with Williams' Awesome, which has only 2 colors. Nevertheless, I do not recommend to enter the market with the Elder Impulse System alone, especially on the daily timeframes, no matter how tempting it may seem.
I'll explain my opinion: to trade on different timeframes often have to change the period of the indicator, especially when it comes to comparing such timeframes as hourly and daily. EIS indicator, does not allow, without interfering with the code, to quickly change its period. It is, so to speak, "stationary", it is impossible to adjust this option quickly and easily. And since on the daily chart there is often a pullback after a rapid growth, and just in such situations the EIS gives us a signal to enter, we get the risk of losses.
Conclusions
Elder Impulse System - dynamic indicatorThe blue bar shows us a good time to transfer the position to Breakeven or to take a part of the profit. When the blue bar appears, it is a good time to make a transfer to Breakeven, or to fix a part of the profit. Entries on the Elder Impulse System, in my opinion, should not be performed. In general, we look at the market more broadly and trade more flexibly.