Elder Impulse System Trade

Entry Logic

• Exact Entry Trigger: The Elder Impulse System colors bars based on MACD Histogram and a 13-period EMA. Enter long on the first green bar after a series of blue (neutral) or red (short) bars. Enter short on the first red bar after a series of blue or green bars.
• Confirmation: The entry must be in the direction of the higher timeframe trend.
• Timeframe: Daily.
• Market Condition: Trending.

Exit Logic

• Profit Targets: Exit when the Impulse System turns blue (neutral), signaling a pause in momentum.

Stop Loss Structure

• Hard Stop: Place stop below the low of the entry day for longs, or above the high for shorts.

Risk Management Framework

• Risk Per Trade: 1% of account capital.

Position Sizing Model

• Sizing Approach: Fixed fractional.

Trade Filtering

• Market Conditions to Avoid: Blue bars indicate choppy, non-trending conditions. Do not enter.

Context Framework

• Trend Direction: Use a weekly 26-period EMA to determine the overall trend direction.

Trade Management Rules

• Let Profits Run: Stay in the trade as long as the bars remain green (for longs) or red (for shorts).

Time Rules

• Session Notes: A swing trading system.

Setup Classification

• A+ Setup: A green bar appears as price pulls back to and bounces from the 13-period EMA in a strong uptrend.

Market Selection Criteria

• Instruments: Liquid stocks.

Statistical Edge Metrics

• Win Rate: 50-60%.
• Profit Factor: 1.9.
• Expectancy: 0.45R.

Failure Conditions

• Strategy Fails: If the higher timeframe trend is not respected.

Psychological Rules

• Discipline: Only trade in the direction of the main trend. Do not short in an uptrend, and do not buy in a downtrend.

Advanced Components

• Filters: Combine with Elder_s Force Index for additional confirmation.

Location

• Strongest: As a re-entry signal within a strong, established trend.