Elder Impulse System
The Elder Impulse System (EIS) is a technical analysis tool which is a combination of 2 various indicators and it is is a powerful trading system. It may be applied in order to identify the best entry and exit points and also to find an upcoming trend reversal. EIS is a powerful trading system and it may also be used together with other technical analysis tools. The EIS can be used for any asset and any time frame. In this article we will explain how to set up and use the Elder Impulse System in your trading.
How Elder Impulse System (EIS) works?
As it was already said, the Elder Impulse System combines 2 indicators: a 13-day exponential moving average (EMA) and a MACD-Histogram. Both have a function of their own. The EMA is used to spot the trend, while the MACD-Histogram determines the momentum (the rate of the increase or decrease in prices).
How to apply EIS in trading?
There are some ways how the EIS can be used in trading. Firstly, you can use the EIS indicator on its own. If a number of green bars appear one by one, it is believed that there is a bullish tendency, but if some red bars bars appear one by one, it is believed that there is a bearish tendency. Traders might decide to open the trade in the appropriate direction.
Yet, you have to remember that the EIS is not able to identify the trend duration. Consequently, it is not possible to determine when the current trend will fade away. Because the trading volume is usually higher during the first phases of strong trends, volume indicators may help.
If you trade, using the EIS on its own, it might be better to wait for an approval. An approval is when 2–3 bars of the same color appear one by one. Although the EIS may be used individually, it is still possible to use it together with technical analysis indicators of various kinds: volume, volatility, etc.
Moreover, you may use the EIS as a secondary tool. For example, if you trade with an Alligator as your main tool, you can still use the Elder Impulse System in order to stay away from false signals. The risk of opening a loss-making trade will be lower if a buy or sell signal, sent by the main indicator, is approved by the same type of signal sent by Elder Impulse System.
According to Alexander Elder, the man who created the EIS indicator, The EIS makes you enter the market carefully but exit quick. This is the professional method of trading. For example, novice traders start trading without thinking a lot and it takes forever for them to get out as they believe and hope that the market will turn their way.
In addition, we should say that EIS just like any other technical analysis tool, is not able to give correct signals all the time. It may and will sometimes send you false signals. It is your responsibility to double check the signals.
How to set up EIS?
It is pretty simple to set up the Elder Simple System and start working with it.
1. Click on the ‘Indicators’ button in the bottom left of the screen when you are in the trade room
2. Go to the ‘Trend’ tab
3. Choose the Elder Impulse System from the list of available options, don’t choose the settings and click ‘Apply’.
You can now use the indicator!
You can change the settings how you prefer, but before changing them make sure you got familiar with all of them, because it can have an effect on the performance of the indicator
Now, that you know how to use the EIS in trading, you can go to the trading platform and try it yourself! You can first try it on the demo account and then use it on the real account.