Parabolic SAR Oscillator
July 11, 2022
This indicator is a detrended price series using the Parabolic Stop and Reverse ( SAR ) trailing stop, resulting in a bounded oscillator in the range (-100, 100).
This indicator is a detrended price series using the Parabolic Stop and Reverse ( SAR ) trailing stop, resulting in a bounded oscillator in the range (-100, 100). The SAR output is also normalized to obtain a noiseless oscillator which can complement the detrended price.
Settings
- Start: Initial value of the convergence factor used when a new trend is detected by the SAR
- Increment: Increment value of the convergence factor
- Maximum: Maximum value of the convergence factor
Usage
The price is detrended by subtracting the closing price to the SAR , this result is then normalized.
An up-trending market is indicated once the normalized SAR reaches -100, while a value of 100 indicates a down-trending market. One can anticipate trends when the normalized SAR crosses above/under 0.
The converging nature of the SAR trailing stop allows for the trader to obtain a very apparent leading oscillator.
