It could be said that I include the Parabolic Sar indicator in all the EA that I made today. And although generally parabolic sar is used as trailing stop as well as stop and reversal system, we actually can use it in another perspective. This is what I get when I learned about Fibonacci lines. I am very confused where to place the swing high and swing low. To make it a mechanical system, there must be clarity where to put those lines.
If we observe any signal change indicated by the Parabolic Sar, then it could be a clue where we put the Swing High / Low Swing of the Fibonacci lines. If you set the parabolic step with the value 0.002, then you will get a good starting point for putting your Fibonacci lines. Place the Swing High / Swing Low right at the signal changes of the Parabolic Sar. If the Parabolic Sar change it’s direction from sell signal to buy signal, it means you should place swing low at the first dot of Parabolic Sar. Actually it is the same whether you place it at the lowest prices that occurred in the previous signal. Now to put the swing high is easy, you just follow the price movements while the Parabolic Sar is still giving buy signals.
But that's just my way to reinforce where to put Fibonacci lines. As a tool, anyone can use an indicator with a variety of ways and interpretation. So, how about to scalp using these indicators? I have no idea.
Sunday, October 24, 2010
Parabolic SAR and Fibonacci Lines
Risk Warning
Please note that Trading in the Foreign Exchange market might carry potential rewards, but also potential risks. You must be aware of the risks and are willing to accept them in order to trade in the foreign exchange market. Don't trade with money you can't afford to lose.
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