Working Money  |  APR 2002

Working Money: Stay In The Market With Stop-And-Reverse by Rudy Teseo

Working Money: Stay In The Market With Stop-And-Reverse by Rudy Teseo If you hate being out of the market, you should take a look at this system. The parabolic time/price system indicator was developed by J. Welles Wilder. Often referred to as parabolic SAR or simply SAR (for “stop and reverse”), the term comes from its appearance as a parabola when viewed on a chart. A SuperCharts help file describes SAR as “a system designed to allow more leeway or tolerance for contratrend price fluctuation early in a new trade, and then to progressively tighten a protective trailing stop order as the trend matures.” The indicator is a stop-setting entry and exit trading system designed to keep the investor in the market at all times. The idea is that if a trade is not continually producing profits, then it should be liquidated. But instead of waiting for the price to bottom and then re-entering with a long position, why not take advantage of the profit opportunities on the way down?

by Rudy Teseo