Parabolic SAR with alerts

The Parabolic SAR with alerts indicator provides a trend-following tool that identifies potential reversal points in market price action through visual markers and automated notifications.

Usage

The Usage section focuses on identifying trend direction and potential entry or exit points based on the Parabolic SAR (Stop and Reverse) dots.

• Trend Identification: When the dots are located below the price bars, the market is generally considered to be in an uptrend. Conversely, when the dots are above the price bars, the market is in a downtrend.
• Reversals: A bullish signal is generated when the SAR flips from being above the price to below it, represented by a green triangle up. A bearish signal occurs when the SAR flips from below the price to above it, represented by a red triangle down.
• Alerts: The script includes built-in alerts that trigger on the close of a bar when a trend reversal is detected, allowing users to stay informed of directional shifts without constantly monitoring the chart.

Details

This tool calculates the Parabolic SAR using standard acceleration factors. The calculation involves an acceleration factor that increases as the trend moves in a favorable direction, allowing the "stop" level to trail the price more closely.

The script specifically identifies the exact moment of a crossover (the "flip") to plot shapes (triangles) and trigger alerts. The logic ensures that a bullish signal is only marked when the current SAR value is below the high and the previous SAR value was above the low, confirming the transition.

Settings

• Start: The initial value for the acceleration factor (default is 0.02).
• Increment: The step by which the acceleration factor increases each time the price makes a new high (for uptrends) or low (for downtrends) (default is 0.02).
• Maximum: The ceiling for the acceleration factor, preventing the SAR from moving too close to the price (default is 0.2).

FAQ

How do I use the Parabolic SAR with alerts?

You can apply the indicator to your chart and look for the triangle shapes to identify trend reversals. You can also set up TradingView alerts using the "Buy SAR" and "Sell SAR" conditions.

What do the triangles represent?

The green triangle up indicates a bullish trend reversal (SAR flipped below price), while the red triangle down indicates a bearish trend reversal (SAR flipped above price).

Where can I access this tool?

You can get access on the LuxAlgo Library for charting platforms like TradingView, MetaTrader (MT4/MT5), and NinjaTrader for free.