their Impulse process was described from their book“Trading with Dr. Elder. Encyclopedia of Stock trading”. The MACD Histogram and the Exponential Moving Average (EMA) are utilized to determine the momentum. The primary principle isn’t to trade against the management of the momentum.
Signals are displayed in the colour of the indicator:
- once the EMA and MACD-Histogram increase, the colour of the heartbeat process is green (earnings are banned).
- when the EMA and MACD-Histogram decrease, the colour of the pulse system is red (purchases are prohibited).
- When the EMA and MACD-Histogram have different directions, the color of the pulse system is blue (purchases and sales are allowed).
Parameters:
- MACD_Short_Length (12) – period of the short EMA for the MACD calculation;
- macd_long_length (26) – Long EMA period for calculating the MACD;
- macd_smoothing_length – 9) – The average interval of the MACD signal line;
- short_ema_length (13) – The period of the EMA averaging.