The Parabolic SAR gives suggestions as to where a trader might place stop loss orders to protect profits or minimize losses.
The chart below of Gold illustrates stop loss placement using the Parabolic SAR indicator:
The Parabolic SAR might be useful to a trader because:
The Parabolic SAR indicator created by Welles Wilder and chronicled in his classic New Concepts in Technical Trading Systems attempts to give easy to interpret buy and sell signals as well as attempts to create an easy to follow methodology for entering stop loss orders.
Sourced from OnlineTradingConcepts.com All copyrights belong to their respective owners.