Why is this transaction stuck?
The transaction spends an output which itself is unconfirmed, it means there's a chain of requirement back two transactions which may or may not be completed. In this case, one previously must be confirmed before this one can enter a block. 


  If this finally process will it transfer to my wallet or reverse to sender account?


It may be confirmed, it may never be confirmed, or it may be invalidated by a double spend, there's no way of knowing this in advance. In general this is why the advice is to never give payment for an unconfirmed transaction, until it has a reasonable number of confirmations there is no assurance it will ever confirm. With LocalBitcoins in particular there is an internal escrow tool which you can use to avoid this in the future.