Parabolic SAR – an effective tool for identifying entry and exit points

Parabolic SAR (Stop and Reverse) – one of the most efficient technical indicators for traders aiming to avoid unsuccessful trades. This tool helps determine optimal levels for opening and closing positions.

How does SAR work?
The indicator tracks price trends, forming levels that follow the price movement. When the trend changes, a signal appears at the reversal point – exactly where you should lock in profits or enter a new position.

Practical application:
• Identifying entry points – when SAR reverses in your favor
• Risk management – setting a stop-loss at the SAR level
• Trend confirmation – using with other indicators for more precise trading

Features for crypto traders:
On volatile cryptocurrency pairs like Bitcoin or Ethereum, SAR is especially useful for short trades. Combining it with technical analysis of trading volumes and support/resistance levels provides a reliable signal.

The key to this approach is consistency. Not every signal guarantees a win, but following the strategy increases the chances of profit.