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Silver H4 Chart - What went wrong with this trade (using PSAR)

jw1981
Nov 14 2012 at 07:01
16 posts
I've been using Parabolic SAR for a few days now and so far got a decent success. I decided to be adventurous and started trading a 4 Hour Silver chart (yesterday). But the trade went bust.

The PSAR showed a BUY signal and I went long at 32.75 in hopes that the price would move higher.

I'm starting to think that the ideal entry into a trade (during a BUY signal/upward trend) is to open a position at the low rather than at the high. Is this true?

Attached is the silver h4 chart. Any inputs would be greatly appreciated.

Gary Sharp myfxpt com
myfxpt
Nov 14 2012 at 20:37
345 posts
Psar is great during a trend, but not so good during sideways trading. You show two moving averages on your chart indicating a buy signal. Your Psar indicates a buy signal. The chart is showing a False Break Buy signal. But...if you were to add a momentum oscillator you would most likely see divergence, which suggests this buy signal is a little weak and you should wait for further confirmation. Try Williams Percent Range (WPR), and wait until WPR is above -20 for a buy, or below -80 for a sell. Good luck!

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