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Parabolic SAR is the technical indicator developed by Welles Wilder for analyzing trend movements. The first time it was announced in a famous book “ New Concepts in Technical Trading Systems” published in 1976. SAR stands for as “stop and reverse”. Parabolic SAR is one of a few indicators that signalize about closing of positions. In many respects Parabolic is similar to a moving average with the only difference that SAR can change position against price. Under ascending tendency, the indicator is drawn under prices (candles, bars), under descending tendency it is put above prices. When price crosses Parabolic line, reversal of the indicator takes place.
Popular article: Forex Entry Strategy
Entry opportunity is the time when a trader can open a position and has a higher probability to gain profit. Mostly, entry opportunities are considered only when a signal is formed. But, for every signal, there are more opportunities than just one. In short, as long as the highest or lowest point of the day isn't reached yet, you also have opportunities to open a position as many times as they are available. But how to calculate entry opportunities at a certain time? Let's use a pair with average daily range 100.0 pips, and price range between 0.00001 to 0.01000. Thus, a strategy with expected profit target of 30.0 will be: average daily range – expected profit = 100.0 – 30.0 = 70.0
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