#BTC突破99k The Parabolic SAR is a common Technical Analysis tool. Here are some clever ways to use the SAR in Candlestick charts:

Buy and sell signal determination

- Buy Signal: When the stock price breaks above the SAR curve from below, it is a buy signal, indicating that the stock price may rise. At this time, investors may consider buying the stock. For example, after a long-term decline in a certain stock, if the Candlestick shows a solid bullish line that crosses above the SAR line, and the stock price subsequently operates above the SAR line for several days, it is a relatively reliable buy signal.

- Sell Signal: When the stock price breaks down from the SAR curve, it is a sell signal indicating that the stock price may decline, and investors should consider selling their stocks. For example, after a period of price increase, if a large bearish candlestick breaks below the SAR line, and the SAR line begins to turn downward, this is often a signal that the stock price is about to decline.

Combine trend judgment

- Uptrend: In an uptrend, the SAR indicator is located below the stock price, and as the stock price rises, the SAR indicator will gradually move up. As long as the stock price does not fall below the SAR line, it indicates that the uptrend remains healthy, and investors can continue to hold the stock to enjoy the gains from the rising stock price.

- Downtrend: In a downtrend, the SAR indicator is located above the stock price and gradually moves down as the stock price declines. At this point, if the stock price does not break above the SAR line, the downtrend has not changed, and investors should avoid blindly bottom-fishing.

Determine stop loss and take profit levels

- Stop Loss Level: After buying stocks, the SAR indicator can be used as a reference for the stop loss level. When the stock price falls below the SAR line, it indicates that the price trend may have reversed, and investors should promptly stop loss to prevent further losses.

- Take Profit Level: During the price increase process, as the SAR line continues to rise, investors can use the SAR line as a dynamic take profit level. When the stock price falls below the SAR line, they can sell the stock to lock in profits.

Used in conjunction with other indicators

- Combining with moving averages: When the SAR indicator gives a buy signal, if the stock price is simultaneously above multiple moving averages and the moving averages are in a bullish arrangement, then the reliability of the buy signal will be higher. Similarly, when the SAR indicator gives a sell signal, if the stock price is below multiple moving averages and the moving averages are in a bearish arrangement, the sell signal is more reliable.

- Combined with trading volume: When the SAR indicator issues a buy signal, if the trading volume increases simultaneously, it indicates that funds are actively buying, and the momentum for the stock price to rise is strong, making the signal highly credible. Conversely, when a sell signal appears, if the trading volume increases, it may indicate that the main funds are accelerating their exit, and investors should sell decisively.

However, any technical analysis method has its limitations, and SAR is no exception. When using it, it is necessary to consider various factors such as the overall market situation to improve the accuracy of the analysis and judgment.