Parabolic SAR Stock Technical Analysis & Parabolic SAR Stocks Signals

Developed by J. Welles Wilder.

The Parabolic SAR is used to set trailing stocks price stops. This stocks indicator is usually referred to as the 'SAR' (stop-and-reversal) and it is used to follow stocks price action closely.

• In an Uptrend, the stop and reversal will trail below the stocks market stocks price
• In a down-wards stocks trend, the stop and reversal will trail above the stocks market stocks price

Stock Technical Analysis & How to Generate Signals

This stocks indicator provides excellent exit points.

Exit Stock Trading Signal for Buy trades

Traders should close long trades when price falls below the indicator.

If you are trading long i.e. The stocks price is above the stop and reversal, the SAR will move up every day, regardless of the direction that stocks price action is moving. The movement of the indicator depends on the number of pips that stocks prices move. When the SAR changes the direction then the stocks market stocks trend also changes to down. This generates the exit signal for long trades.

Exit Stocks Trade Signal for Sell trades

Traders should close short trades when price rises above the indicator.

If you are trading short i.e. The stocks price is below the stop and reversal, the SAR will move down every day, regardless of the direction that stocks price action is moving. The movement of the indicator depends on the number of pips that stocks prices move. When the SAR changes the direction then the stocks market stocks trend also changes to up. This generates the exit signal for short trades.

Exit Signal for Buy & Sell trades