Impulse Indicator
Impulse indicator is an easy to use technical tool for identifying suitable trade entry points. An incredible trend reversal detector.
Description
In forex trading, time can mean the difference between winning or losing. While it is imperative to do your due diligence, there is no room for hesitation when a trading opportunity appears. For this reason you need an indicator that gives you trading signals without delay.
What Is an Impulse Indicator?
As the name implies, an Impulse indicator enables you to take trading opportunities swiftly. The indicator combines Moving Average Convergence Divergence Indicator (MACD) and Exponential Moving Averages. This means you get refined and accurate trading signs. Like MACD, the indicator forms a window below the price chart. It provides buy and sell signals by changing color from green to sky blue to red.
It works well on any time frame and can use the indicator to trade any instrument. Some traders combine it with other technical tools for confirmation. The Impulse indicator will prove very helpful for scalping, medium or long term trading.
How Do You Read Impulse Indicators?
Trading with Impulse trading indicators is quite easy. You only need to identify the prevailing color on the indicator. It provides traders with an opportunity to identify price dynamics that are otherwise hard to notice with naked eye.
When the prices rise, the indicator fills the bars green. When the price dips the bars turn red. The deep sky blue bars are a tell tale sign of a ranging market.
Buy Signals
Simply buy when the impulse indicator bars turn red. Exit when the downtrend is ongoing and the indicator changes to sky blue.
Sell Signals
Sell when the impulse indicator bar turns green. Exit when the green bar changes to deep blue sky in an ongoing bullish.
Real Trading Example
The chart shows price movement for the Great Britain pound against the Canadian dollar. When the price is nose diving the chart posts red candlesticks. The indicator confirms the downtrend by posting red bar graphs. However, the downtrend dwindles and the indicator posts a deep sky blue bar. This signifies an impending price reversal. You should exit the trade. In fact, the indicator posts green bars indicating a start of a bullish trend. The prices rise as shown by the blue candlesticks.
Conclusion
The impulse indicator is one of the simple to use indicators but that refines the signals with two great indicators. It combines the EMA and MACD to ensure the signals have a high accuracy. simply wait for the indicator to form a green bar to buy and sell when the bars turn red. You might want to use other strategies such as price action to enhance the signals. Finally, you get to know when the trend is about to reverse.