Parabolic SAR – Best way of Trader’s Interpretation!

SAR or the Sop and Reversal are the most prolifically used tool for the determination of the Highest Probability of Price Reversal. This is a directional Indicator invented by the Welles Wilder and is the logical way for traders to predict and control the happenings in the market. It should also be noted that this indicator named SAR can be applied preferably to the Trending Market and is not that useful in case of the Flat and strong market.

Bullish and bearish Trends are the parts of this SAR and are plotted accordingly to the positioning of the dots above and below the price. The trading Signal is thus confirmed according to the nature and the behavior of the SAR curve. The indication of the Stop and Reverse is provided with taking Market Trends and the situation in the consideration.

The most striking feature of this powerful tool can be stated as the sheer mechanical nature and the ability of the Mathematical Precision, as well. At the same time, it should also be noted that this SAR can be utilized only in case of the Trending Markets which is its limitation. However, its provision of suggesting the near end of the commodity makes it as worth considering for use by the Traders.

 

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