What Is a Parabolic Indicator?
SAR is a stop-turning indicator. Because a series of stopping points form a parabolic shape, SAR is also called a parabolic-turning indicator.
Parabolic turning indicator
Right!
- Chinese name
- Parabolic turning indicator
- Foreign name
- SAR
- Definition
- A series of stopping points form a parabolic shape
- Application
- Buy signal when SAR goes below the price curve
- SAR is a stop-turning indicator. Because a series of stopping points form a parabolic shape, SAR is also called a parabolic-turning indicator.
- Parabolic Steering (SAR) is also called Stop Loss Point Steering. Its full name is "Stop and Reveres" (abbreviated as "SAR"). It was created by American technical analysis master Wells Wilder. It is a simple Easy-to-learn, accurate mid-to-short-term technical analysis tools.
- Parabolic steering is the use of parabolic methods, adjusting the stop loss point position at any time to observe trading points. Because the stop loss point (also known as the turning point SAR) moves in an arc, it is called a parabolic turning indicator. [1]
- One is "stop", which means stop loss,
- SAR calculation formula is divided into ascending and descending, that is:
- Ascending SAR2 = SAR1 + AF (H1SAR1)
- Descending SAR2 = SAR1 + AF (L1SAR1)
- In the formula: SAR1-yesterday's SAR value.
- Low price, its descending initial value takes the recent highest price
- H1 the current highest price.
- L1-the current lowest price.
- AF Wilt acceleration factor, the base value is 0.02, when the price hits a new high (upward) or a new low (downward)
- Increase by 1, 2, 3 ... multiples until 0.2, that is AF = 0.02 0.2.
- It can be seen from the formula that when the initial value of SAR1 is taken as the lowest price recently, that is, when the market is regarded as rising, the condition of the current highest price H1> SAR1 must be met. Once H1 <SAR1, the descent is enabled, and when the market continues to decline, the condition of the current lowest price L1 <SAR1 must be met. The setting of the acceleration factor reflects the changing process of the market "starting acceleration deceleration zero reverse start ......", and also results in a parabolic visual effect.
- 1. A buy signal is issued when the SAR falls below the price curve.
- Issued when SAR is above the price curve
- 1) When the SAR indicator shows a downward trend and falls below a set reference value, a sell signal is displayed.
- 2) When the SAR indicator rises upward and crosses the turning point, it means that the market shows a certain buying signal, and investors can perform appropriate buying operations at this time.
- 3) If the market is in a state of consolidation, the reference role of the SAR index is relatively small, and the error rate is also high.Try to avoid using it in the consolidation area.
- 4) When the trend of the channel is more obvious, the signal of the turning point is also more accurate.At this time, the SAR indicator and the DMI indicator are combined to analyze the market situation, and the result will be more accurate.
- 5) .When the general SAR index shows a clear rising or falling state, it has a close relationship with the fluctuation range and time of the actual price, and it also maintains some relevant characteristics of exchange rate fluctuations.
- 6) The SAR indicator combines analysis of time and price to give sufficient time for the price to fully adjust.If the market reverses, the stop loss point can not only be closed long, but also be short at the beginning of this other market. [2]