Impulse Current Method(ICM) is limited by the sophisticated test waveforms and the lack of automatic data processing algorithm. Aiming at the problem, an automatic ICM using differential directional traveling waves and cross-correlation analysis is proposed. Based on the propagation characteristics of cables, the influence of the attenuation distortion and dispersion distortion on the position of the correlation peak is analyzed. The dispersion distortion in the low frequency band is the main factor that declines the location precision of correlation analysis. A low-cost high-reliability and wide-band directional decoupling method for traveling waves is proposed, using current measurement data of two same linear couplers at both ends of the leading cable which are synchronized with the first pulse. The influence of the difference of current and voltage sensors’ transfer characteristics within wide frequency band is evaded. Simulations show the location errors are no more than 0.7% for non-near-end faults. The experimental result on a power cable is 207.26m, while the real fault distance is 207±1m, with a relative error of no more than 0.61%.