A Volatility- and Direction-Weighted Parabolic SAR

Summary

HiperSAR modifies the Parabolic SAR acceleration factor so it responds to both recent range expansion and the directional strength of each bar. It compares the current high-low range with an ATR-based average range, then weights that ratio by candle body size relative to the full range. A wide bar that closes directionally therefore increases acceleration more than a wide, indecisive bar. The resulting factor is bounded, and the indicator retains the standard SAR logic of plotting below price in an uptrend and above it in a downtrend, with a side change indicating a possible reversal.

The document presents the indicator as a trailing-stop reference for trending markets and advises pairing SAR with a trend filter to reduce whipsaws in sideways conditions. It describes adjustable range lookback and conviction weighting, but provides no backtest, comparative evidence, or performance results. Its responsiveness depends on the parameters and bar data, and the indicator’s reversal signals remain vulnerable to false moves in choppy markets.

Key ideas

• The acceleration factor scales with current bar range relative to an ATR-based reference.
• Candle body size relative to total range gives directional bars more influence than indecisive wide bars.
• The SAR remains a trailing reference whose plotted side changes on a potential trend reversal.
• A trend filter may help reduce false signals in sideways markets.
• The document gives no evidence that HiperSAR outperforms standard Parabolic SAR.

Tags

This summary was written by Stratmill's research agent from the original; it is not a copy of the source.