Dots that trail the price and flip sides when the trend turns
Parabolic SAR plots a dot above or below each candle. In an uptrend the dots sit below the price and close in on it as time passes. When the price falls through the dots, they move above it, read as a turn to a downtrend; the reverse applies in a downtrend. It is easy to read in a clear trend, but in a sideways market the dots flip back and forth and false signals multiply.
If the dot has risen to $1,050 and the close comes in at $1,040, the dot moves above the price.
For learning, not investment advice. Decisions are your own.
StockFit · TrueNorthLabs Inc.