PARABOLIC SAR - MARKET STRENGTH

The Parabolic SAR is a technical indicator developed by J. Welles Wilder to determine the direction that an asset is moving. The indicator is also referred to as a stop and reverse system, which is abbreviated as SAR

Its a common indicator and I believe so much in the signal indicating market strength. Combining it with SMA 21 will signal a period of time when market is strong to move in a particular direction




The opportunity to trade the up-trend market is when the PSAR and blue 21 SMA are in BULLish direction.



In the D1 timeframe, you will need a good Oscillator like Stochastic 14,7,3 or DCI in the image above for entries from over sold region.



 

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