You must be wielding a weapon, shield or at the vary lest a improised weapon. You get a -4 to Parry if unarmed (unless you got the Improved Unarmed Strike feat). If you are using an improised weapon, then you get a -1 to Parry (unless you have the barbarian's Versatility ability). You can parry an adjacent foe with a reach weapon. An attack roll that is equal to you opponent's Parry Defence will cause the weapons to be locked together (you both have to make opposed grapple checks to knockback the loser). I hope this helps.