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Indicators

What Is Parabolic SAR

Parabolic SAR is a dot drawn each day on one side of the price: below it while the price rises, above it while it falls, moving a growing share of the way toward the run's extreme each day and jumping to the other side when a candle reaches it. This paper shows you gold's dots through the April 2025 run drawn from real bars, the idea as a parabola that starts slow and curves up faster, the dotted trail on the daily chart, the dot's daily steps in dollars through one run, and the two numbers that set it on your platform.

Difficulty
Intermediate
Reading time
5 min
Pages
8
Reviewed by
Saman Rahbar

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A dot on one side of the price

Parabolic SAR is a dot drawn each day on one side of the price: below it while the price rises, above it while it falls. The dot moves toward the price a little each day, and when a candle — one day's bar — reaches it, it jumps to the other side and starts again. On 10 April 2025 gold's dot jumped below the price to 2956.38, the low of the fall just ended, and climbed toward the candles day by day. On 30 April a candle's low touched it, and it jumped above the price to 3499.96, the high of the rise, and began coming down.

A parabola

The picture is a parabola, the curve a ball makes when it is thrown along the ground and starts to climb. The dots begin with small steps and curve up faster and faster, closing on the price above them. That is the rule inside the indicator: each day the dot moves a share of the way toward the run's highest point, and the share grows a little every time the price makes a new high. A run that keeps making new highs has its dots bending toward it ever more steeply, until one day the price falls back onto them.

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