Overview
Parabolic SAR Trend Following is a clean trend-following strategy built around the classic Parabolic SAR indicator.
It is designed to identify directional phases and follow them through a simple, rules-based signal model. This makes it suitable for traders who want a straightforward way to track trends across different markets and timeframes.
Signal Logic
The strategy monitors how Parabolic SAR shifts relative to price.
A bullish signal appears when SAR flips below price.
A bearish signal appears when SAR flips above price.
This creates a trend-following model that aims to enter as direction changes and stay aligned with the move until the signal reverses. The SAR settings can be adjusted to make the strategy behave more slowly and steadily or more quickly and responsively.
Parabolic SAR
| Parameter | Description |
|---|---|
| Acceleration | Base sensitivity of the SAR. Higher = more reactive from the very start, lower = smoother and slower. |
| Acceleration max | How quickly SAR increases its acceleration as price continues in the trend direction. Higher = faster tightening of SAR → earlier exits and more signals, lower = steadier, smoother trend tracking. |
| Acceleration step | The upper limit of SAR acceleration. Controls how tightly SAR can follow price during long, strong trends. Higher = very responsive in extended moves, lower = more conservative. |
Common Features
Each strategy has its own signal logic, but installation, setup, and trade management are identical across the product line. Once you know how to use one, you know how to use the rest.
See also: