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What is Parabolic SAR?

Parabolic SAR is a trend indicator: an analytical tool that helps determine the direction of price movement and perform trend trading. SAR is short for “stop and reverse”.

Parabolic SAR works best in a strong trend market. It is not recommended to use the indicator for trading high volatility assets and trading on a sideways trend. In this case, Parabolic SAR often gives false signals.