Parabolic Stops.

Quoting bluemonkey

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Along time ago I ran into an article discussing how to use the parabolic sar to set stops. I can't find it now. Anyone know what they were talking about and how you would use them for stops?

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Quoting Lou

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Hi Blue..

try this link http://www.investopedia.com/articles.../02/042202.asp

or go to Investopedia.com and do a SAR search.

You thinking of trying this on the median system?

Lou

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Quoting WTB

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SAR by itself is meaningless, just like trading MAs crossovers or RSI's overbough/oversold by themselves will only lead to a miserable loss in the long run. Having said that, I do believe that SAR does have its value when it comes to visualize some aspects of the chart. Something similar like Hekinashi candles.

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Quoting vegas

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bluemonkey,
I'll tell you an interesting story.

SAR is Welles Wilder's "Parabolic Time Price" system, developed around 1980.

In the mid 1980's, a group of guys hit the trading floor and used this to trade the S&P futures contract [back then the futures contract was 500 times the index, and a move of 0.05 index points was = $25]. Two months later they were all gone.

By the way, you can simulate SAR very easily with Jurik Moving Averages (JMA). If you look hard enough [google search] you can find the code and put into metatrader 4.

SAR ONLY works well in a medium-paced trending market. All other types and it fails badly. My gut feeling is that the system was developed for the gold market in the late 1970's, to catch that 6 year bull market, which was basically a one-way street for about 70 months.

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Quoting quinn

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Vegas great stuff!

Not only do you help us to trade better but your combat experience, helps out a lot, when it comes to questions like BlueMonkey posted.

Who da thunk Forex Factory could get any better?
Glad your here man, appreciate all the good info.

Thanks
Quinn

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Quoting vegas

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bluemonkey,
I'll tell you an interesting story.

SAR is Welles Wilder's "Parabolic Time Price" system, developed around 1980.

In the mid 1980's, a group of guys hit the trading floor and used this to trade the S&P futures contract [back then the futures contract was 500 times the index, and a move of 0.05 index points was = $25]. Two months later they were all gone.

By the way, you can simulate SAR very easily with Jurik Moving Averages (JMA). If you look hard enough [google search] you can find the code and put into metatrader 4.

SAR ONLY works well in a medium-paced trending market. All other types and it fails badly. My gut feeling is that the system was developed for the gold market in the late 1970's, to catch that 6 year bull market, which was basically a one-way street for about 70 months.

Ignored