The Parabolic SAR is a widespread method of technical analysis, invented by Welles Wilder. The renowned analyst termed the indicator this way because a curve on a chart looks like a parabola. SAR is an abbreviated phrase “stop and reverse”. The Parabolic SAR is both a reversal and trend indicator. It changes its direction when it intersects a price. If a parabola is below the price, the bullish trend unfolds in the market, whereas a parabola above the price indicates the bearish trend. The indicator provides more evident signals on longer time frames where a trend is steadier.