Parabolic SAR Settings by Timeframe: 36 Tests

Most Parabolic SAR settings guides begin and end with 0.02 and 0.20. One number is labelled Step, the other Maximum, and both look precise enough to be settled facts.

They are not equivalent controls. Step changes the starting speed and every later acceleration. Maximum only caps that acceleration. To separate them, I tested six values of each on USD/JPY: 36 combinations, three timeframes, two full years, and both halves of 2025.

The useful headline is not one winning pair. Hourly bars kept 23 of 36 settings positive in both full years. On four-hour bars, the 0.02/0.20 default made +637.7 pips in 2025 and lost 108.2 pips in 2024. On hourly 2025, it lost 1,032.5 pips in the first half and made 1,847.7 in the second.

20242025positive in both years6 steps x 6 ceilings = 36 settings

What Parabolic SAR is measuring

SAR moves a dot from its current position toward the extreme price reached in the active trend:

next SAR = current SAR + acceleration factor × (extreme price − current SAR)

In an up move, the extreme is the highest high since that move began. In a down move, it is the lowest low. Each new extreme raises the acceleration factor by Step until Maximum stops it. When price reaches the dot and the dot switches sides, the trend state reverses.

At 0.02/0.20, the factor starts at 0.02. New extremes take it through 0.04, 0.06 and so on, reaching 0.20 after nine updates. The two settings therefore have distinct jobs:

• Step sets the initial factor and the amount added after each new extreme
• Maximum limits how fast the dot can catch price late in a sustained move

This article tests flips at the bar close. It does not assume that an order filled at the plotted SAR price. That distinction matters whenever a bar passes through the dot before closing.

How to read Parabolic SAR settings

The indicator draws one sequence of dots over the price chart. It has no lower pane and no reference levels.

Every field in the settings dialog

The 0.02 is not 2% of price. It advances the dot by 2% of the remaining distance between the current dot and the extreme. At the 0.20 ceiling, that advance is capped at 20% of the remaining distance per bar.

What appears on screen

Dots below price are the up state; dots above price are the down state. Platforms may use different colors, but color is not part of the formula. There are no default 30/70-style levels to add.

The trading rule tested here

That is the Stop and Reverse part of the name. The opposite signal closes the current position and starts one in the other direction. Long and short use the same rule.

Which control is worth changing

Raising Step makes the dots react sooner, so it also increases the number of reversals. Raising Maximum only matters after enough new extremes have pushed the factor toward that ceiling.

The hourly 2025 sweep makes the difference visible. Mean trade count rose from 215.3 at Step 0.005 to 777.7 at 0.05. Maximum 0.30 averaged 608.8 trades and Maximum 0.50 averaged 609.8. Step was the main frequency control.

How this was measured

Which timeframe can you use?

Hourly bars have the broadest result, not merely the best outlier. Most settings were positive in each year, and 23 stayed positive in both.

The 0.03/0.10 hourly setting made +3,910.5 pips in 2024 and +981.4 pips in 2025. A large profitable-setting count does not mean each setting will produce a similar annual net in both years. Four-hour bars changed from 32 positive settings in 2024 to eight in 2025.

What do step and maximum change?

The next table averages across all six Maximum values on hourly bars.

20252024mean over six ceilings; USD/JPY H1, 0.1 lot

Taking Step from 0.005 to 0.05 raised frequency 3.6 times. Net pips did not rise with it. The slowest step averaged +1,240.3 pips in 2025 and −1,138.4 in 2024.

Maximum has a saturation point in trade count. Its 2025 mean rose from 316.3 trades at 0.05 to 479.8 at 0.10, then flattened: 608.8 at 0.30 and 609.8 at 0.50. A high ceiling does little whenever the live acceleration factor rarely reaches it.

Are the 0.02/0.20 defaults good?

Hourly is the only timeframe where the default made money in both years. Annual net ranged from +886.8 pips in 2025 to +2,683.6 in 2024.

The four-hour default made +637.7 pips in 2025 and −108.2 pips in 2024. One year alone cannot settle whether to use it.

Does one year's best carry over?

Take each year's winner and move it untouched into the other year:

On 15-minute and hourly bars, the selected setting stayed profitable in the other year. On four-hour bars, both selected settings lost in the other year. One setting remaining profitable does not show that the other settings will transfer in the same way.

The shorter split is also different. Hourly 0.02/0.20 made 281 trades and lost 1,032.5 pips in the first half of 2025, then made 1,847.7 pips over 266 trades in the second half. The full-year +886.8 pips combines two halves with opposite signs.

Why a 40% win rate was enough

The hourly default in 2025 made 547 trades at a 40.04% win rate and PF 1.074. Its average winner was +58.71 pips; its average loser was −36.49. The payoff gap, not a majority of winning trades, produced the +886.8 pips.

The default won 38.79% in 2024 and made +2,683.6 pips, versus a higher 40.04% win rate and only +886.8 pips in 2025. A 1.25-point increase in win rate coincided with 1,796.8 fewer annual net pips.

Does an ADX filter help?

These filters apply only when entering the hourly default Parabolic SAR reversal rule.

All three ADX thresholds turned 2025 negative and cut the 2024 result. Adding a second trend condition to a trend reversal signal removed useful entries.

London/NY hours nudged 2025 up to +982.7 pips but pulled 2024 down to +2,465.3. No filter beat the baseline in both years.

Do stops and timed exits help?

Every exit variant stayed positive in both years. None beat the opposite-flip baseline in both. Stop 100 / target 200 raised 2025 to +1,600.4 pips but lowered 2024 to +2,302.3.

How much spread can it take?

Only the spread changes here: hourly 0.02/0.20, 2025.

The loss from zero spread is exactly trades × spread. Dividing the gross +1,050.9 pips by 547 trades gives a 1.92-pip break-even spread.

On 15-minute bars, the default traded 2,290 times and lost 375.3 pips. Once flips become that frequent, cost matters before fine differences between acceleration settings do.

Related tests

• Supertrend settings: another flip-based trend rule, with period and multiplier separated over 36 settings
• Alligator settings: three displaced lines used to read trend instead of a trailing dot
• Moving average crossover settings: the same hold-to-opposite-signal structure applied to MA periods
• How to backtest without code: build the conditions used in this article through the interface

Notes

• One pair and two full years: USD/JPY in 2024 and 2025
• Parabolic SAR implementations can differ in their initial direction, order of extreme updates and prior-bar clamps. These numbers use Formiq's implementation
• Orders fill at the close of the flip bar, not at the plotted SAR value
• Spread is flat at 0.3 pips and slippage is zero in the main sweep
• The 36-setting grid brackets the common default; it does not test every possible decimal
• The four-hour default made 130 to 138 trades a year, so its win rate and PF come from fewer trades than the hourly and 15-minute versions