SAR

Stop and Reverse

Also known as Parabolic SAR because on chart SAR appears as bunch of parabola.

SAR is designed to effectively trade stocks moving in clear trend.

INTERPRETATION:

  • As buy sell signal: Buy when SAR appears below price and sell when SAR meets or crosses price. You can also do short selling in the similar fashion: sell when SAR appears above price and close the position when SAR meets or crosses price.
  • For calculating stop-loss: The most recent value of SAR can be used as stop-loss.
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