SAR Color Alert Indicator

The SAR Color Alert Indicator is an upgraded version of the traditional Parabolic SAR used in forex and other financial markets. The classic Parabolic SAR (Stop and Reverse) plots a single-colored series of dots above or below price to signal trend direction and potential reversals. While effective, its single-color format often becomes visually confusing when combined with multiple indicators on the same chart.

The SAR Color Alert indicator solves this issue by introducing a dual-color system, making trend changes clearer and easier to interpret.

Is the SAR Indicator Good for Trading?

Yes — the Parabolic SAR is widely used to:

Identify the current market trend

Track potential trend reversals

Generate entry and exit signals

However, the standard version can be visually limiting due to its one-color display. This is where the SAR Color Alert indicator provides a major improvement.

Features of the SAR Color Alert Indicator

The SAR Color Alert indicator enhances the classic tool by:

Displaying bullish trends in blue

Displaying bearish trends in red

Offering optional alerts when trend reversals occur

Improving readability when used alongside other technical tools

This makes it highly beginner-friendly yet equally useful for experienced traders.

How to Trade Using the SAR Color Alert Indicator

In the example image, the indicator draws:

A blue parabola below the candle → suggests a bullish trend

A red parabola above the candle → suggests a bearish trend

Trading Rules

Buy Signal:
Open a long position when the blue parabola forms below the price candle.
Stop-loss may be placed below the recent swing low.

Sell Signal:
Open a short position when the red parabola forms above the price candle.
Stop-loss may be placed above the recent swing high.

Recommendation

While the indicator performs well in trending markets, it is best used together with:

Price action

Support/resistance

Trend confirmation indicators

This ensures stronger accuracy and reduces false signals in ranging markets.

Conclusion

The SAR Color Alert Indicator is a simple, effective, and beginner-friendly tool that enhances the classic Parabolic SAR by using two colors to highlight market direction. It clearly marks bullish and bearish trends and can also send alerts when a reversal occurs. Overall, it is a helpful indicator for traders who want cleaner visuals and better trend clarity — and it is available for free download.