Parabolic SAR Is Simple to Use & Quite Reliable | Forex Factory

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Parabolic SAR Is Simple to Use & Quite Reliable

  • #1
  • First Post: Edited 6:43am Sep 11, 2017 3:48am | Edited 6:43am
The chart below is a monthly Parabolic SAR chart for EUR/USD pair. All you do is follow the positioning of PSAR. If down you buy, if up you sell. The daily chart is for short term trades, weekly chart for swing trades, while monthly is for long-term trades. You try all three periods and see which one gives you the most returns in a given year. You buy into a better market price before closing a losing trade, to maintain long-term ownership of any given Forex pair. Your feedbacks are welcome.
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Mecrandie
  • #2
  • Sep 11, 2017 4:36am Sep 11, 2017 4:36am
Quoting mecrandie
http://www.netdania.com/currencies/eur-usd-chart The chart linked above is a monthly Parabolic SAR chart for EUR/USD pair. All you do is follow the positioning of PSAR. If down you buy, if up you sell. The daily chart is for short term trades, weekly chart for swing trades, while monthly is for long-term trades. You try all three periods and see which one gives you the most returns in a given year. You buy into a better market price before closing a losing trade, to maintain long-term ownership of any given Forex pair. Your feedbacks...

Parabolic SAR works very well in a strongly trending market, you will get killed when it starts to range though
I live entirely from the growth of my personal trading account
  • #3
  • Sep 11, 2017 4:48am Sep 11, 2017 4:48am
Quoting mecrandie
http://www.netdania.com/currencies/eur-usd-chart The chart linked above is a monthly Parabolic SAR chart for EUR/USD pair. All you do is follow the positioning of PSAR. If down you buy, if up you sell. The daily chart is for short term trades, weekly chart for swing trades, while monthly is for long-term trades. You try all three periods and see which one gives you the most returns in a given year. You buy into a better market price before closing a losing trade, to maintain long-term ownership of any given Forex pair. Your feedbacks...
Have you tested it, back or forward? PSAR has been available for a quite while, so your idea is not very innovative, right? Can you show results?

I did test. Many combinations. Break of psar and entry, break of psar, pull back and entry. In combination with emas ect ect. For many pairs, for many time frames and for many periods, more than 3

Results were at best erratic, which is not uprising.
  • #4
  • Sep 11, 2017 5:34am Sep 11, 2017 5:34am
Be aware that PSAR was invented and designed as a method of stop loss adjustment, NOT as a method of entering trades.

As Guy wisely mentions above, in a ranging market it will kill you, if you try to use it that way (and in a strongly trending market you won't need it as a way of entering trades anyway).
  • #5
  • Sep 11, 2017 6:31am Sep 11, 2017 6:31am
Quoting mecrandie
http://www.netdania.com/currencies/eur-usd-chart The chart linked above is a monthly Parabolic SAR chart for EUR/USD pair. All you do is follow the positioning of PSAR. If down you buy, if up you sell. The daily chart is for short term trades, weekly chart for swing trades, while monthly is for long-term trades. You try all three periods and see which one gives you the most returns in a given year. You buy into a better market price before closing a losing trade, to maintain long-term ownership of any given Forex pair. Your feedbacks...
I
Guy you are right about ranging market. But that is critical mostly for scalpers. If I am scalping I enter a buy trade when m1 pulls back momentarily to return to h1 direction which alligns with a base psar, which itself has a steep slope upward.

For swing and long term trades, I don't react to fluctuations less than 300 pips, where I usually place my trailing stop. See my FF explorer.
Mecrandie
  • #6
  • Sep 11, 2017 6:39am Sep 11, 2017 6:39am
Quoting mecrandie
{quote} I Guy you are right about ranging market. But that is critical mostly for scalpers. If I am scalping I enter a buy trade when m1 pulls back momentarily to return to h1 direction which alligns with a base psar, which itself has a steep slope upward. For swing and long term trades, I don't react to fluctuations less than 300 pips, where I usually place my trailing stop. See my FF explorer.

Well best of luck with that )
I live entirely from the growth of my personal trading account
  • #7
  • Sep 11, 2017 7:02am Sep 11, 2017 7:02am
Quoting mecrandie
See my FF explorer.

Sorry if I sound rude, but I see that it shows heavy losses, and if you're trying to use the position of PSAR dots relative to the price candles as a way of entering trades, I'm not surprised.

Learn something from Guy and Karl, Mecrandie. Inventiveness and imagination can be assets, it's true, but this isn't a plausible or reasonable way to try to trade, and it isn't based on anything sound.
  • #8
  • Sep 11, 2017 7:58am Sep 11, 2017 7:58am
Quoting Quickly
{quote} Sorry if I sound rude, but I see that it shows heavy losses, and if you're trying to use the position of PSAR dots relative to the price candles as a way of entering trades, I'm not surprised. Learn something from Guy and Karl, Mecrandie. Inventiveness and imagination can be assets, it's true, but this isn't a plausible or reasonable way to try to trade, and it isn't based on anything sound.
Did you see my FF explorer? What's is your annual returns rate? Few trading styles perform at that level and the average return for that industry is 6 - 7%. I welcome specific adjustments to the trading style, but not total abandpnment.
Mecrandie
  • #9
  • Sep 11, 2017 8:06am Sep 11, 2017 8:06am
Quoting mecrandie
{quote} Did you see my FF explorer? What's is your annual returns rate? Few trading styles perform at that level and the average return for that industry is 6 - 7%. I welcome specific adjustments to the trading style, but not total abandpnment.
Your explorer says -1645 pips.... You are welcome to check out my trading style and results here https://www.forexfactory.com/showthread.php?t=698461
I live entirely from the growth of my personal trading account
  • #10
  • Sep 11, 2017 8:08am Sep 11, 2017 8:08am
No disrespect at all, mecrandie, but my average annual return rate has absolutely nothing to do with the fact that this style of trading isn't based on anything sound or real, and isn't even related to what PSAR was designed to do, at all.

No need to take my word for it: a simple backtest of a decade's data on any currency-pair you like will easily show you that.
  • #11
  • Sep 11, 2017 8:42am Sep 11, 2017 8:42am
Quoting mecrandie
{quote} Did you see my FF explorer? What's is your annual returns rate? Few trading styles perform at that level and the average return for that industry is 6 - 7%. I welcome specific adjustments to the trading style, but not total abandpnment.
annual 6-7%? Oh my... I should invest my money for average of 1% per day plus bitcoin is rising.
  • #12
  • Sep 12, 2017 1:14am Sep 12, 2017 1:14am
Quoting mario777
{quote} annual 6-7%? Oh my... I should invest my money for average of 1% per day plus bitcoin is rising.
You know as well as I do that you can average 1% a day at such a high cost in commissions, time, technology and taxes that your net profit is is next to zero. Scalpers are more like gamblers who display their occasional jackpots and hide their perpetual losses. Name one institution that pays you 1% interest per week, talk less per day. Be realistic and don't discourage new investors.
Mecrandie
  • #13
  • Sep 12, 2017 1:25am Sep 12, 2017 1:25am
Quoting mecrandie
{quote} You know as well as I do that you can average 1% a day at such a high cost in commissions, time, technology and taxes that your net profit is is next to zero. Scalpers are more like gamblers who display their occasional jackpots and hide their perpetual losses. Name one institution that pays you 1% interest per week, talk less per day. Be realistic and don't discourage new investors.

While I agree with the essence of what you are saying I do though disagree with your comparison of an individual traders potential returns and what institutions will pay to a passive investor, as it ignores at least two things, the effort the trader is putting in and the leverage he is using on his account.
I live entirely from the growth of my personal trading account
  • #14
  • Sep 12, 2017 6:47am Sep 12, 2017 6:47am
Quoting GuyBaker
{quote} While I agree with the essence of what you are saying I do though disagree with your comparison of an individual traders potential returns and what institutions will pay to a passive investor, as it ignores at least two things, the effort the trader is putting in and the leverage he is using on his account.
The APR for any trading Capital (even if you borrow from yourself) is about 20% whichich boils down to about 2% a month. Add to that 10% for your effort, 10% for operating costs and another 10% for taxes. That gives you a total projected annual return of 50%, which is equivalent to about 4.18% a month. Any strategy that averages 4-5% a month should therefore be considered effective for basic manual trading.
Mecrandie
  • #15
  • Sep 12, 2017 6:57am Sep 12, 2017 6:57am
Quoting mecrandie
{quote} The APR for any trading Capital (even if you borrow from yourself) is about 20% whichich boils down to 2% a month. Add to that 10% for your effort, 10% for operating costs and another 10% for taxes. That gives you a total projected annual return of 50%, which is equivalent to about 4.18% a month. Any strategy that averages 4-5% a month should therefore be considered effective for basic manual trading.
20% if u borrow fron yourself, what does it mean?, surely this number should be based on a reasonable no risk savings rate, 10% for effort? This must vary on how
much time you spend and how much you could earn otherwise from job etc. Also need to factor in risk. So whether it is worth trading and how much you need to make is going to vary greatly from individual to individual depending on opportunity cost and available free capital mainly
I live entirely from the growth of my personal trading account
  • #16
  • Sep 12, 2017 7:18am Sep 12, 2017 7:18am
Quoting GuyBaker
{quote} 20% if u borrow fron yourself, what does it mean?, surely this number should be based on a reasonable no risk savings rate, 10% for effort? This must vary on how much time you spend and how much you could earn otherwise from job etc. Also need to factor in risk. So whether it is worth trading and how much you need to make is going to vary greatly from individual to individual depending on opportunity cost and available free capital mainly
Bully Guybaker , as usual you responded to a precise post with with a nonsense series of bla , bla , bla & bla .
Mecrandie , you are a good trader , please stay away from this bully.
  • #17
  • Sep 12, 2017 7:28am Sep 12, 2017 7:28am
Quoting redoktober
{quote} Bully Guybaker , as usual you responded to a precise post with with a nonsense series of bla , bla , bla & bla . Mecrandie , you are a good trader , please stay away from this bully.
It is obvious that he needs help, which is why we have a forum like this.
Mecrandie
  • #18
  • Sep 12, 2017 7:35am Sep 12, 2017 7:35am
Quoting redoktober
{quote} Bully Guybaker , as usual you responded to a precise post with with a nonsense series of bla , bla , bla & bla . Mecrandie , you are a good trader , please stay away from this bully.
Thank you Redoktober.
Mecrandie
  • #19
  • Sep 12, 2017 7:42am Sep 12, 2017 7:42am
Quoting mecrandie
{quote} Thank you Redoktober.
There are multiple complaints to admin about redoktober, you are free to listen to who you wish of course it is really no skin off of my nose
I live entirely from the growth of my personal trading account
  • #20
  • Edited Sep 13, 2017 2:00am Sep 12, 2017 7:51am | Edited Sep 13, 2017 2:00am
Quoting jdieieh
{quote} Have you tested it, back or forward? PSAR has been available for a quite while, so your idea is not very innovative, right? Can you show results? I did test. Many combinations. Break of psar and entry, break of psar, pull back and entry. In combination with emas ect ect. For many pairs, for many time frames and for many periods, more than 3 Results were at best erratic, which is not uprising.
Things are usually erratic when you are trading by the minute. That's why investors, as opposed to day traders, focus on midterm and long term market trends. What PSAR does is to aggregate all the ups and downs and give a support line above which you buy and below which you sell. When you apply it to the monthly period, you may not even use the trailing stop loss because there are very few sudden catastrophic trend reversals.
Mecrandie
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