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Thread: Indicator Parabolic Sar

  1. #1
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    Indicator Parabolic Sar

    Thanks to Roboforex company, Roboforex forum, Admin and Moderators: I would like to begin my thread with a big thanks to the Roboforex company for creating the Roboforex forum which is beneficial to all traders and newbies in numerous ways. Also I am greatfull to the Roboforex management, Forum admin and Moderators not just because I have been given another opportunity to participate in a contest and win a prize but also because this contest will give rise to so much useful information about all commonly used indicators at one place.

    The Indicator Parabolic SAR : As always I would not go in detail about the history about this indicator or how it is calculated. It just makes things complicated. My intention is always to keep things simple and be realistic about the practical application of an indicator. I like this indicator because it is simple in terms of both understanding and application. The parabolic sar can be used by traders who want to take benefit of trend or hunt reversals. The SAR stands for stop and reversal. Parabolic SAR is used well in conjunction with a trading system and can help to determine the entry price, stop loss, profit target and exit price. Parabolic SAR appears as a series of dot either above or below the price of a currency pair or commodity as shown in figure,


    Application of Parabolic SAR in trading The basic concept of the Parabolic SAR is rather simple. When the dots appear above the price bars then that means the price may now move downwards. Similarly when the dots appear below the price bars then the possible price movement is upwards.


    Parabolic SAR can be used to determine the entry price as well as the exit price for a trade

    1. Entry price for a trade : When the Parabolic SAR points appears below the current price of a currency pair then we can open a buy trade. Similarly when the Sar dots are placed above the current price of a currency pair we can open a sell trade.

    2. Exit price for a trade : Suppose we are holding a buy trade then when the dots move from below the price bars to above the price bars then we should close the trade as the uptrend might be over and the market is preparing for a downward move. Similarly when we are holding a sell trade we can close it when the dots starts coming below the current price at that means the prices may start moving up.


    Setting of the indicator Parabolic Sar
    : It is better to have the default parameters while using this indicator. You can chose the style that you may think pleasant.


    My opinion and views about Parabolic SAR Parabolic SAR gave right signals for Eurusd move on Friday ( 15th May, 2015) On Friday I was expecting the price of Eurusd to move some pips past 1.1400 but would not stay there for long. So when the prices moved over 1.1415 and the SAR points begin to rise over the current price I quickly made a sell at 1.1416. That was a good sell as the prices then started falling. However I could not wait patiently for the next signal and closed the trade when I was a profit of 25 pips at 1.1490 level. The price then fell as low as 1.1320. However I was in profits so went to relax. But again the SAR points gave good signal to make a buy at 1.1325 level when the dots came below the current price. Please look at the chart below. The current Eurusd price is at 1.1449.


    Conclusions
    : As we all know that no indicator is perfect in giving signals. And so it is very possible that Parabolic SAR can also give false or wrong signals. But I think more number of times it gives good signals. As always we can be prepared for the negative. Also conbination of Parabolic SAR with other indicators preferably indicators designed to determine the strength of a trend like the ADX- Average Directional Index.

    This indicator can be used with charts of any time frame But I would prefer it on charts with lower time frames than 1 Day. Parabolic SAR has given best performance with the currency pair Eurusd. It has also given good performance with Gbpusd, usdjpy and Gbpjpy. However Parabolic SAR can be used as a strategy well with any currency pair when combined with other relevant indicators.


    Precaution against market discounting an indicator or even a combination of indicators
    Sometimes the market may be in a mood to move in the same direction as indicated by our indicators. While sometimes the market may be in no mood to value the indicator. But when our strategy and indicator dont work it is at that time our skills to keep our loss small is checked. Professional traders do not easily become victim of big losses.We should always plan our safety.

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    Last edited by PROPENSITY100; 05-20-2015 at 03:07 PM.

  2. #21
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    parabolic sar is one of the best indicators of the market and the trader that know how to use it properly will be able to get good results and make consistent profits from the market ,this indicator is good with the trend and can be very effective when there is a clear direction for the market and help the trader to get good return always.

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  3. #22
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    Parabolic SAR indicator is very simple for trader. Most of traders is not using this indicator. Because of they can't find hopeful result from the indicator. Because of Parabolic SAR indicator is best from H1 and H4 time frame but not for correct result from others time frame.

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  4. #23
    Trader YoyO_o's Avatar
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    first of all thanks for the indicator you shared here and please tell me how much you earn with this?
    i think that the most important thing thats required in forex trading is to trade with the plan and for it you need solid plan to trade and to develop good trading

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    Last edited by YoyO_o; 11-22-2016 at 11:30 PM.

  5. #24
    Trader WhoAini's Avatar
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    [lang=id]nice explanation you bro, but Indicator Parabolic Sar would be great if we use only in the Asian session, I also never use Indicator Parabolic Sar in 2013 and then, with the result pretty good I continue to innovate in trade me bro, until I found blend a very good indicator to do this trade, and also to analyze the long term, in D1 or W1
    learn and understand only one or two indicators alone bro so that we really understand and can master it well[/lang]

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  6. #25
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    Parabolic SAR is an outstanding indicator and it is very simple in use i also use in my trading , and setting i think it is good if trade make it according to his knowledge ,it is very simple to follow like we may use it as buying and selling indicator and newbie can understand it in a easy way .

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  7. #26
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    Quote Originally Posted by Hukam View Post
    Nice to hear about the functions or features of parabolic sar indicator, You have described it very well mate, I have a question for you. How can I handle the sideways market condition if I am using parabolic sar on my chart. How it deal in sideways market? Hope you will don't mind that mate, and will give the answer of my question, Its a new indicator for me that's why I am very interesting in it.
    Yes my mate. Parabolic SAR indicator is a good indicator for technical analysis. We can use it for technical analysis. Also, I am using this indicator in my terminal template.Multi time frame analysis is needful by using this indicator. We could see future market trend by the parabolic indicator.I am using parabolic indicator in H1 time frame and found good accuracy.

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  8. #27
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    parabolic sar is a good indicator and work well in the trendy market and help the trader to catch the trend from its beginning to the end and so the trader can maximize his profits and can be able to make more and more money, it is good indicator for giving of good signals buy its dot and so the trader easily can detect the signals of trading.

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  9. #28
    Trader tfs2012's Avatar
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    Lightbulb My own approach with this indicator

    Parabolic SAR is one of my favorite indicators and I have a very easy strategy that depends only on this indicator, The good in this indicator is that it gives you the right place to put a stop loss, not only this but also you can use it as a trailing stop tool.
    Let us now come to the most important thing, which is the best way to use this wonderful indicator, In my opinion, the strength of this indicator and other indicators as well is to be used in a multiple time frames to give you a clear view of the market.
    I use the indicator on the daily time frame to determine the market direction and use it on the four-hour time frame to determine the entry point and stop the loss
    I use a multi-timeframe version of the indicator so I don't have to change the time frame each time i want to check for a signal it is easier that way.

    In the picture below the blue is the daily Parabolic SAR and The Magenta is the four hours Parabolic SAR


    GBPJPYproH1.jpg

    overall, This idea does most of the work that a trader is required to do, You can use supports and resistances to determine the take profit or any other method, it is up to you.
    Attached Files Attached Files

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  10. #29
    Trader tfs2012's Avatar
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    Smile

    Well, this is an update of what I previously posted about the best way to use the Parabolic SAR

    GBPJPYproH111.jpg

    We can clearly see how it worked perfectly
    The method gives us

    1-the entry point
    2-Where to put the stop loss
    3-trailing stop
    4-exit point


    But it is not always that easy and the idea does not give us all these things properly
    The problem is often at the exit point
    If we look at this example here we find that the entry points were very good, but using trailing stop will be resulting in a loss of 90 points

    GBPJPYproH1174.jpg

    For this reason, it would be good to learn one of the well-known trading methods
    For example, I use Harmonic patterns and price patterns
    So this is how I'll see the chart

    GBPJPYproH1har.jpg ABCD-harmonic-pattern.png

    furthermore

    GBPJPYproH17.jpg bearish-three-drive.gif

    You can see the difference when we add only Harmonic patterns, earning more than 430 pips


    As a conclusion, I can say that this indicator can be used very effectively as a key tool for trading, but additional ways should be used to improve its results
    I have shared some of these ways in this post
    http://forum.roboforex.com/threads/2...l=1#post786969

    There is also a similar method I used with another indicator you can check it out here
    http://forum.roboforex.com/threads/2...erful-strategy

    I hope all of this was helpful to someone and good luck

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  11. #30
    Trader ara's Avatar
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    I remember one thing, Parabolic SAR is the first indicator that I used to trade in forex market, yep ..., when I joied into forex trading business, Parabolic SAR is the first indicator that I learned and I used it without combination with other indicators. Parabolic SAR is good for trend follower, but we can not use it singly, we have to keep to analyze trend market and sideway market, because if we impose to trade in sideway area by using Parabolic SAR, then it just wasting our money.

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