Introduction
Designed Vélez Vaylderom, creator of RSI and DMI, Parabolik sets the price stops moving for long or short positions. Also known as an indicator of stop and turn (the full name "Parabolic SAR" - Facing the foot and parabolic), Parabolik more popular in order to regulate the placement of stop orders, rather than to establish the direction of movement or trend. Vaylder recommended to first determine the trend and then trade with Parabolikom in the direction of the trend. If the trend is directed upwards, it should buy when the indicator moves below the price. If the trend is downwards, it should sell when the indicator moves above the price.
Calculation
The formula is quite complex and goes beyond the scope of this article, but the interpretation of the indicator is relatively straightforward. Dotted lines below the price set foot moved to the long position, and moved through the above set foot for the short position. At the beginning of the movement, Parabolik provides long distance between the price and stretches her foot. Once the motion becomes stable, the distance between price and indicator is compressed, allowing you to place a stop order more closely when the price moves in a favorable direction.
Defined by two variables: the maximum step and step. The higher the step is set, the more sensitive the indicator will be to price changes. If the step is too high, the indicator will fluctuate above and below the price too often, making it quite difficult to interpret. The maximum step controls the regulation Parabolika while the price moves. The lower set to the maximum step, the next stop will move from the price. Vaylder recommended to set the step in the .02, and set the maximum step at .20.
Microsoft Graph shows how Parabolik can capture the majority of emerging trends and to allow the trader to receive profits from the signals of purchase / sale.
Sample
Set the default settings, which recommends Vaylder, reduce the influence of minor fluctuations, but the indicator does not provide immunity from fast turn (black arrow). Appropriate interpretation of this indicator implies that a trader should close long positions when the price falls below Parabolika (red arrow) and close short positions when the price rises above Parabolika (green arrow).
Parabolik works best during periods of strong trend, which is estimated very Vayldera occur about 30% of the time. Therefore, the user can first determine whether the market is developing a trend of using other indicators such as ADX Vayldera line, and then sell the use of Parabolika in the direction of the trend.
The use of graphics programs
In most graphic programs Parabolik included in a standard package of technical tools. Typically, for Parabolika you can set any parameters and to select as a step (first option) and a maximum step (second option). The default is usually set recommended settings Vayldery.
Designed Vélez Vaylderom, creator of RSI and DMI, Parabolik sets the price stops moving for long or short positions. Also known as an indicator of stop and turn (the full name "Parabolic SAR" - Facing the foot and parabolic), Parabolik more popular in order to regulate the placement of stop orders, rather than to establish the direction of movement or trend. Vaylder recommended to first determine the trend and then trade with Parabolikom in the direction of the trend. If the trend is directed upwards, it should buy when the indicator moves below the price. If the trend is downwards, it should sell when the indicator moves above the price.
Calculation
The formula is quite complex and goes beyond the scope of this article, but the interpretation of the indicator is relatively straightforward. Dotted lines below the price set foot moved to the long position, and moved through the above set foot for the short position. At the beginning of the movement, Parabolik provides long distance between the price and stretches her foot. Once the motion becomes stable, the distance between price and indicator is compressed, allowing you to place a stop order more closely when the price moves in a favorable direction.
Defined by two variables: the maximum step and step. The higher the step is set, the more sensitive the indicator will be to price changes. If the step is too high, the indicator will fluctuate above and below the price too often, making it quite difficult to interpret. The maximum step controls the regulation Parabolika while the price moves. The lower set to the maximum step, the next stop will move from the price. Vaylder recommended to set the step in the .02, and set the maximum step at .20.
Microsoft Graph shows how Parabolik can capture the majority of emerging trends and to allow the trader to receive profits from the signals of purchase / sale.
Sample
Set the default settings, which recommends Vaylder, reduce the influence of minor fluctuations, but the indicator does not provide immunity from fast turn (black arrow). Appropriate interpretation of this indicator implies that a trader should close long positions when the price falls below Parabolika (red arrow) and close short positions when the price rises above Parabolika (green arrow).Parabolik works best during periods of strong trend, which is estimated very Vayldera occur about 30% of the time. Therefore, the user can first determine whether the market is developing a trend of using other indicators such as ADX Vayldera line, and then sell the use of Parabolika in the direction of the trend.
The use of graphics programs
In most graphic programs Parabolik included in a standard package of technical tools. Typically, for Parabolika you can set any parameters and to select as a step (first option) and a maximum step (second option). The default is usually set recommended settings Vayldery.
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