The Parabolic SAR is a trend following indicator invented by J. Welles Wilder, who also brought us the RSI and ATR.

The Parabolic SAR is displayed by a series of dots above or below the price. If the dots are below the price, the trend direction is bullish, and when they are above it, the bears are driving the price down.

The indicator helps to determine the trend direction and when it can reverse. Therefore, it can be used for entry and exit points in trending markets.

As J. Welles Wilder recommends, the Parabolic SAR tells us about the trend direction. But, to find stronger buy or sell points within the trend, we would need to make use of an additional indicator.