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Parabolic SAR (stop and reverse) indicator serves as stop loss level definition for Forex traders. For binary options traders it helps determine general trend direction as well as define potential trend reversal levels. Learn more about parabolic SAR and how to use it.

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Parabolic SAR Explained

Parabolic SAR is a technical analysis indicator which helps determine stop-loss levels for classic Forex and CFD traders. It is also very useful indicator for binary options traders, since it also provides the information about general trend direction. If the Parabolic SAR dots are above the price, the indicator tells us that the trend will continue moving down and the trader should 'sell' or 'put' and if the dots are below the price, the trend direction is up, and the trader should 'buy' or 'call'.

How to use Parabolic SAR with binary options trading?

Binary options trading systems based only on Parabolic SAR indicator can be developed, but it is useful to combine this indicator also with other indicators, for example ADX or DMI indicator.

Take a look at the example of binary options strategy built upon these two indicators and watch the Parabolic SAR Trading Strategy video.