parabolic SARS

I was just messing around with my demo account, and i am currently intrigued by Parabolic Sars. To tell you the truth, I have no idea what they are based on and how accurate they are. just curious.

This explains it all.

http://www.investopedia.com/terms/p/...cindicator.asp

or here
New Concepts in Technical Trading Systems,Wells Wilder

while the sar looks great and can be a key indicator to a system, it isnt quite as good as it looks. I ran into this problem while trying to make a system around it.

I created my own SAR that shows exactly where the calculations are and removes the lead it that looks so great

witchazel could you clear something up for me about the ASAR indicator you posted.

From what I see it looks like blue indicated buying pressure and red indicated selling pressure. But the position of the dot's is where I'm a bit lost. It looks like if the dot's are above the price line it's going to go down, despite buying pressure, and if their under the price line they'll untilately goup, despite selling pressure.