Parabolic SAR (Stop And Reverse)

Parabolic SAR (Stop And Reverse) is a trend indicator J. Welles Wilder introduced in 1978, plotted as dots above or below price. The dots act as a trailing stop-loss that follows the trend (the acceleration factor AF starts at 0.02, rises by 0.02, capped at 0.20); when price crosses a dot, the position stops and reverses. It works in trending markets but produces many false signals in a range.