Parabolic SAR

Hello everyone,

I was wondering when you guys used the parabolic SAR? if at all. i read on babypips.com thats its only good to use it in a trending market? what about on short term 1h or 30m charts? my amateur guess is that its better for longer time frame charts.

Any help would be appreciated. thanks.

I have seen traders using this P.sar dot for scalping on low tf like 1-to 15minutes charts with different settings
& this indicator its seems useful there

thanks, i will try it out myself and see.

are there any other indicators that you use in conjunction with the SAR to help you better recognize the trend?

Ask Jay Walker - he uses parabolic sar plus another indicator.

My experiments with parabolic sar were successful, especially on mtf, but, like any mechanical system, prone to extended drawdown.

it's good for a stop loss indicator, hence the name "STOP and reverse," but like smikester said, it has its advantages and disadvantages. like other indicators, though, it shows the same info as other indicators. you just need to know what it's looking at.

thanks guys

i only use it on long-term time frames -> from 4h upwards

I do use PSAR for all my timeframes.

However it is very dangerous to enter a trade simply based on the PSAR alone, I use it together with MACD and Stochastic to get a better entry.

Let say you have a up trend but prices in forex market do not move in a straight line. It usually moves in a form of waves. When the price is retracing, the PSAR will flip to the top of the candlestick and when the price is extending, the PSAR will flip to the bottom of the candlestick.

At this time, you should be watching out on your stochastic to see if the market is oversold and if it is, you can wait for your MACD histogram to flip to the up side before you enter a LONG trade.

This is how I usually trade using my PSAR. Hope this is helpful to you.

Hi there

I too am having problems using parabolic - I use it on the M5 timeframes and it tends to get stuck and either needs resetting or just a click over the page resets it - however it is a problem as you can watching the monitor annd do not know how or when to differentiate from normal movement, ie sideways or you need to refresh...has cost me money this week - any comments?

Are you using the SAR for exits or for trend determination?

I read on one of the forums that this strategy is quite workable on the EUR/USD 30-min chart.

As far as, I cannot attach images yet and keep my journal as I am used to doing it, I want to share some insights about Parabolic Sar.

Welles.J.Wilder, author of the indicator, recommeded using it only in trending markets. As it comes from its name, Parabolic SAR - Stop and Reverse, it shows quite good entry and exit points.

In my opinion, Parabolic Sar is undervalued and overviewed indicator by traders and rarely seen as a valued instrument for technical analysis nowadays.
There is a trend in each timeframe, so there is a good use of Parablic SAR even in small timeframes. I will show it further with the screenshots of my trades. But if you cannot define trend and use Parabolic SAR in correction phase of market, then chances are good that it will lead you to loss.

I use Parabolic Sar for entry and exits.
Moving Averages and Stochastic for defining trend and correction.