How to make a profit with the Parabolic SAR indicator

The advantages of simple operation and clear buying and selling points make SAR a short- and medium-term technical indicator that is especially suitable for novice traders. In addition, as an auxiliary tool, it can also be used in conjunction with other indicators to provide a better standard for closing positions.

Parabolic SAR (SAR), also known as stop-loss point turning, is the use of the parabolic balance line method to adjust the position of the stop-loss point at any time to observe the buying and selling points. Since the stop loss point (also known as the SAR point) moves in an arc pattern, it is called a parabolic SAR indicator.

Wield. The timing of buying and selling is when the price crosses the SAR, that is, when the SAR is broken to the **, it is sold, and it is bought when it crosses the SAR upward.

1) Use the SAR indicator to set a stop loss.

The SAR indicator can give stop loss and reversal points with quantitative **. The essence of SAR is the process of changing the position of long and short. When the pair is above the stop loss point, we keep our positions open, which means that we are bullish and bullish.

But after the pair breaks below the stop loss point, our action is to sell our position, which means that our attitude is bearish, bearish. The change from long to short depends entirely on whether the pair breaks the stop loss or not. The stop loss point becomes the dividing line between long and short shifts.

This is also the reason why SAR is used as an indicator of stop-loss turning.

2) According to the operation angle and time of the SAR indicator, judge the trend of **.

When the SAR curve runs downward at an angle greater than 45 degrees, it means that the bears are relatively strong, and the decline of the Huihe price is relatively rapid, and the exchange rate will continue**. At this time, investors should resolutely hold the currency and wait and see, and should not easily grab **.

When the SAR curve runs upwards at an angle greater than 45 degrees, if the SAR curve has been running upwards for a long time and the exchange rate has risen too much in the short term, it means that the bulls have consumed too much power, and the exchange rate may reverse to the downward direction at any time. At this time, investors should pay close attention to the trend of the SAR curve, and once the SAR indicator sends a clear sell signal, they should resolutely clear their positions and exit the market.

When the SAR curve moves upwards at an angle greater than 45 degrees, if the SAR curve just runs upwards, it means that the bullish forces are starting to accumulate and the pair will continue to climb upwards. At this time, investors should resolutely hold the stock and wait for the rise.

When the SAR curve runs downward at an angle of less than 45 degrees, and the SAR curve continues to run downward for a long time for at least 3 months, once the pair breaks through the SAR curve upwards, it indicates that the medium- and long-term trend of the pair may end, and investors can start to take dip positions.

When the angle of the SAR curve is less than 45 degrees, if the SAR curve has been running downward for a long time and consolidating at a low level for at least 3 months, it means that the strength of the bears has been exhausted, the strength of the bulls has begun to strengthen, and a new round of growth in the exchange rate has been, and the exchange rate will continue. At this time, investors should resolutely hold positions and wait for the rise.

3) Evaluation. 1) The operation is simple, the buying and selling points are clear, and the signal can be carried out;

2) SAR and actual **, the length of time is closely related to the digging system, which can adapt to the fluctuation characteristics of different forms of stock prices.

3) Calculation and drawing are more complicated;

4) In the handicap, signals often appear alternately, and the error rate is high.

The calculation formula of SAR is divided into ascending and descending, namely:

Ascending SAR2= SAR1+AF(H1 SAR1)Descending SAR2= SAR1+AF(L1 SAR1)where: SAR1 Yesterday's SAR value, the initial value of the rising formula is the most recent one.

Low price, its declining initial value to take the most recent **.

h1 is currently the most**.

L1 is the current low.

AF Wilt acceleration factor, with a base value of every new high (rising) or new low (falling).

Press 1, 2, 3....The multiplier increases until, i.e., af=.

It can be seen from the equation that when the initial value of SAR1 is taken as the lowest price in the near future, that is, ** is regarded as rising, the conditions of the current highest **h1>SAR1 must be met. Once h1 <>

From the analysis principle of the parabolic indicator SAR, it can be seen that the formation process of the SAR indicator contains the content of the market trend, that is, it contains the long trend and the short trend. No matter how the market changes, it revolves around the two trends of bulls and bears, and the parabolic indicator SAR has a strong sensitivity to such changes in the market, especially in the market"Stop the loss"The aspect is more unique.

How investors understand"Stop-loss operation"This? So-called"Stop-loss operation"It means that when the investor is in the ****, because the timing of the **** and the ** is not very reasonable, the stock price not only did not rise, but **, resulting in a loss, and at this time the investor should consider selling it in the period with the least loss, that is, let it"Losses"As soon as possible"Stop", which is what the market does"Stop-loss function", the parabolic indicator SAR has this function, which is also called"Operational protection function"。How does the parabolic indicator SAR achieve it?"Stop-loss function"What about it?

When the stock price diverges from the parabolic SAR indicator, the parabolic SAR indicator will have a stop loss signal. This is where it should be"Stop-loss operation"。

Parabolic indicator SAR"Protective features"It is reflected in the following situation, that is, when investors want to make money on the first place, they should first learn to protect their capital and not lose money, so that they can talk about making money, that is, they must understand"Defend first, then attack"thoughts. Because everybody knows that"It's harder to sell tickets than to buy them"After applying other technical analysis indicators, if the stock price is unexpected, then investors should use the parabolic indicator SAR to help themselves"Stop-loss operation", that is, to protect their own funds and not let them lose too much.

In addition, the parabolic indicator SAR"Stop loss"The nature can also be understood as:"Two-way stop-loss", you can't help but sell tickets when the market is long and short, and you can't buy tickets when the market is long and empty. That is, the parabolic indicator can analyze the selling and buying of the market.

To sum up, this is the analytical function of the parabolic indicator SAR, which investors should fully understand.

1. When SAR falls below the curve, a scattering signal is emitted.

2. When the SAR crosses above the ** curve, the Zizi gives a sell signal.

3. When the DMI confirmation of the market is a trending market, the technical credibility of the sell signal issued by the SAR indicator is high.