Do you use Parablolic SAR?

Do you use the Parabolic SAR indicator and do you feel like it is helpful?

I’m a newer trader, but this has always seemed to be the least reliable indicator for me. It seems like sometimes it is just flat wrong (Fakeouts?) and when it is right, it tends to be late to the party and generally unhelpful.

I want to grant that I’m newer and simply may not be using it correctly.

Any comments/advice would be appreciated.

Thank you.
Mike G.

I think the parabolic SAR is not intended to be used as an indicator to enter a market but instead as an indicator to exit. I could be wrong but when im in a trade (demo ofcourse) I sometimes check the parabolic SAR indicator to see how long I should follow the trend.

When you can trade both ways, isn’t entering and exiting the market the same thing?

For example, you have a position Long on EURUSD and use Parabolic SAR to see that the trend may be reversing and you sell your position and take your gains.

At the same time, I have no open positions but see the same chart as you and go Short on EURUSD at the same point.

In essence, we’re both doing the same thing, right?

true they are the same technically however on entering the market you are putting more weight on the parabolic SAR indicator and thus risking more as it isn’t an indicator to show entrance/exiting but just as an indicator to show the market trend. For example you enter a trade on more specific indicators like MACD, Stoic, BB and then you follow your trade with 2ndary indicators like parabolic SAR just as an extra tip to know when is safe to pull out. This is what I think and I am a newbie so… but for me I think that indicator is relatively accurate during the trade but on entering a trade I have never been successful

Good entry point indications can be very finicky and if you use those same indications reversed as your exit it may give false exits or miss the exit altogether.
This is where the PSAR can be an excellent addition to a strategy, use the PSAR either as your main exit point indicator, thereby ignoring false exits by your entry point indicators reverse signal, or as a back up indicator in case your regular strategy misses the exit altogether, this is also useful in automated trading where a missed exit can be the difference between a nice profit and a loss.

So for instance your regular strategy may say when moving average (a) crosses moving average (b) and the price is below line © exit the sell position.
This may work well most of the time except the occasion where the moving average (a) crosses moving average (b) so the price reversed, but the price never went below line C.
Therefore you miss the exit and the price reversal is wiping out your profit but then, if you have your second backup exit strategy to say, if the moving averages have crossed and the PSAR is below the line, exit the sell position.
This could save your trade in those circumstances.
This applies especially well in automated trading when you may not be watching.

The reason it is not usually reccomended for use as your regular entry point indicator is because it often reacts late so you enter the trade late and leave it late with the PSAR this will bring too many losses.

The PSAR can be uncannily accurate in some circumstances during a long price move it often doesnt react to false reversals but then does react to the real one, albiet a few bars late, but sometimes its better late than never.