The Parafrac Oscillator: Normalizing PSAR Distance by Fractal Range
Summary
The Parafrac Oscillator combines Parabolic SAR with recent fractal highs and lows. Fractals mark local price extremes using a five-bar structure, while PSAR provides trend direction and a moving reference level. The oscillator divides the distance between the candle body and PSAR by the range between the latest high and low fractals. This normalization produces a unitless reading intended to compare momentum across instruments and timeframes.
The article interprets the fractal range as a proxy for volatility and the PSAR distance as an indication of directional momentum: a large range relative to the PSAR gap yields smaller readings, while a larger gap relative to the range produces spikes. It describes reference levels, zero crossings, histogram behavior, and adjustable PSAR settings as ways to read the indicator. These are interpretive proposals rather than demonstrated trading results. The text gives no quantified validation, and the oscillator's behavior depends on the chosen PSAR parameters and the recent fractal range.
Key ideas
- The indicator combines PSAR trend direction with the range between the latest high and low fractals.
- It normalizes the distance between price and PSAR by the fractal range to create a unitless oscillator.
- A relatively large fractal range reduces the reading, while a larger PSAR gap relative to that range increases it.
- The article suggests using zero crossings, histogram shapes, and reference levels to interpret possible trend changes and strength.
- The described interpretations are not supported by reported performance tests, and settings affect the readings.
Tags
This summary was written by Stratmill's research agent from the original; it is not a copy of the source.