Parabolic SAR is a trend indicator that helps us to identify the current trend using the series of dots above or below the price.
Configure Parabolic SAR on IQ Option
Naturally, you need to first log in to your IQ Option account. Then click on the indicator button at the bottom of the page and select Parabolic SAR from the menu.
You can also change the indicator colour and the time frame. However, It works best on default settings.
About Parabolic SAR:
Parabolic SAR is a trend indicator used by traders to determine the trend direction of the security. This indicator is really easy to use and you can easily identify the current trend using the series of dots around the price. If the dots are below the price it signals a bullish trend and similarly, If the dots are above the price it signals a bearish trend.
How to Trade with Parabolic SAR?
Identifying and Trading with the Parabolic SAR is quite simple. You just need to focus on the dots and how it behaves.
Make Buy Trade with Dots below the Price
When the P-SAR dots are below the price it indicates a bullish trend and here we need to make a buy trade.
The bullish signal will be much more powerful. If there big distance between the price and indicator.
Make Sell Trade with Dots above the Price
Similarly, when the dots are above the price it signals a bearish trend and here we need to make a sell trade.
Again, as you can see above the distance between the price and dots are big so, it signals a strong bearish trend.
Is Parabolic SAR a good Indicator?
P- SAR is one of the most reliable indicators you just need to focus on the dots and How it behaves. When the P-SAR dots is really close to the candlestick it signals that the market is in a range bound and you need to avoid making trades here similarly, When the distance between the P-SAR dots and candlestick is big it signals a strong bullish or bearish trend and you can make lots of bucks here.
The last point here, I want to add is If you really want to get some good results you should trade in long time frame charts because you will then see fewer market fluctuations and making avoid 1-minute trades at any cost.
If you really want to understand this indicator properly you should practice the same in the IQ Option demo account. Here, you will get $10, 000 free virtual money you can easily practice your strategies in the same and check How P-SAR actually behaves and If it is worth your time.