Parabolic SAR: the trailing-stop indicator

How parabolic SAR moves

During an uptrend, dots plot below price; during a downtrend, above. As the trend extends, the dots accelerate toward price — the acceleration factor (AF) starts at 0.02 and grows with each new high or low. When price hits the dot, SAR flips to the other side and the cycle restarts.

The "parabolic" name comes from this acceleration — the dot's path curves toward price like a parabola.

Strengths and the obvious weakness

Strength: in a clean trend, SAR keeps you in the move while ratcheting the trailing stop. Pure mechanics, no judgement required.

Weakness: in a sideways market, SAR whipsaws constantly. Every flip is a small loss, and they add up. SAR is a trend-only tool; pairing it with ADX (which measures trend strength) is the common defence.

How Signodex uses parabolic SAR

Signodex renders SAR on every chart and tracks the most recent flip. The AI references it as a trend-confirmation layer ("SAR is on the bullish side and the most recent flip was 14 candles ago, consistent with the established uptrend") rather than as a trade signal.