Just to clarify this, for anyone wondering ... All these pasted/copied/reproduced online "Impulse" things mistakenly referring to the author as "Alexander Helder" stem from one original typo in a poor, inadequate and misleading online version of Dr. Alexander Elder's famous "Impulse System", originally described in his book Come Into My Trading Room. It's not quite as described above, needless to say.
One thing I must point out here is that most traders are discouraged because they feel the awesome oscillator is difficult to understand but the principle is simple: latest signal cancels previous signals. This oscillator to be is better than the likes of MACD, EMA, SMA which are common to traders. This strategy combines it well with the MACD making it a very powerful indicator from the Bill William series. I think this system is really cool.
You might want to try keeping different company, if "most traders" you know are discouraged because they feel the awesome oscillator is difficult to understand (or perhaps if they care about it at all). It's essentially only a 5-period/34-period moving average crossover shown as a histogram below the chart instead of as two MA lines crossing on the chart. There's no more to it than that.
You are right. It is a just a histogram which shows the market momentum for recent number of periods as compared to the momentum of an increased number of previous periods. I really like it as it tells me more about the current period and I use it a lot in getting more accurate entry and exit signals.
Talking in details as regards the impulse system. If you properly use the EMA and MACD components of the impulse system, you will be able to know when the trend is taking off. My favourite exponential moving average for the impulse is the 13 period EMA. Sometimes, I would use more than one time frame for the purpose of signal confirmation.
The truth is trading the forex is all about buying low and selling high. Knowing about the momentum of the market is thus very important; it is equally important to get your hand on the trend,that is a why an exponential moving average with a moderate period of 14 is best for the impulse system.
I have seen that in this system, some trades don't even know exactly what role the moving average plays in the impulse trading system. It is more like the moving average is used to smoothen noise from price action, and get knowledge of the direction of the trend. The moving average I use some times also is the 13-period moving EMA. It is weighted so it pays more attention to recent prices.
That's true, but the terminology is slightly confusing: both are "weighted", but exponential moving averages aren't the same thing as weighted moving averages: WMA's are weighted according to a factor that decreases uniformly over increasingly distant data-periods, whereas in the case of EMA's the weighting factor increases exponentially as the compilation-data become more remote.
I'd advsie you to do that from the original source (Elder's book) rather than from the site linked to in this thread's first post, which misdescribes it.