Parabolic Sar MTF is a multi-time frame trend following indicator which can filter out the noise in the price action and generate consistent results in the market. Parabolic Sar indicator can be used to determine trend direction and potential reversals in price action. This Trading system is based on dual Parabolic SAR indicators which help to filter out the wrong signals. Let’s try to understand the functioning of this trading system.
Parabolic Sar MTF Indicator Overview
The Parabolic SAR indicator appears on a chart as a series of dots, either above or below the price. if the price is in an uptrend then dots will appear below the price and if the price is in a downtrend then dots will appear above the price.
In this trading system, 30 periods parabolic SAR indicator is used on the 5-minute chart along with the 5-minute Parabolic SAR indicator. A higher time frame Indicator works as a filter and protects traders from taking less convincing trades.
Parabolic Sar MTF Indicator Explanation
When the price is trading above the Red dots it means there is an uptrend in the market and traders should do only long trades. A trader should go long when blue dots start appearing below the price.
When the price is trading below the Red dots it means there is a downtrend in the market and traders should only do short trades and avoid going long. Traders should short the market when blue dots start appearing above the price. Psar indicator cal also is used to exit the trade.
Also Read: Pinbar Detector Indicator
Parabolic Sar MTF: Buy Conditions
- The higher high and higher low pattern in price action.
- Red dots should form below the price.
- Breakout on 5 minutes Psar when above condition Satisfy.
- Traders should hold long trades till the time price trades above the 5 minute Psar.
Parabolic Sar MTF: Sell conditions
- The lower high and lower low pattern in price action.
- Red dots should form below the price.
- Breakout on 5 minutes Psar when above condition Satisfy.
- Traders should hold long trades till the time price trades above the 5 minute Psar.
