PIN BAR Trading Strategy in Detail Price Action Analysis

Bearish Pin Bar – When you spot a valid bearish pin bar setup, you could sell the Forex pair at the first candlestick which closes below the small wick of the pin bar. Pin Bars occurring at support/resistanceOnce the prices touch the support or resistance range, two things can happen. The first is that the prices can break out of this level forming a new trend. A Pin Bar forms when buyers or sellers step in to prevent the prices from going further up or down. It takes a good eye to identify these instances which technical analysis proponents call a false breakout. In fact, I suggest taking into context of the markets you’re trading, irrespective of the candlestick patterns you’re trading.

As an order flow trader, at the core of most my strategies is volume analysis. It’s a great way to build context for any trading strategy. On strong breakout days a retrace back to the volume weighted average price can provide a good opportunity to get in on the trend.

Don’t let the simplistic nature of a trading pattern like a pin bar mislead you into thinking it’s useless. On strong trending days don’t trade pins against the trend. Odds are you will see a ton of them and they will all fail. Successful trading strategies are profitable because they are repeatable, whereas random patterns are not.

pin bar candle stick

Price rejection indicates a fakeout that hunt stop loss of retail traders. Big banks and institutional traders make this fakeout to eliminate the retail traders before the origin of a new trend. That’s why price rejection helps us to know about the exact key reversal levels. A valid pin bar is one, wherein the wick goes above the price action. The highest probability pin bars are reversal signals that come after a prolonged price move.

If an orange candle occurs after a bearish pin bar, you should enter a sell position. In figure 6, we can see an illustration of how a pin bar formation failed at support level. Doji candle can form within trend or range and it represents fxcm reviews indecision of the market while pin bar indicates a reversal in the trend. You have to trade with the big banks or institutional traders to make a profit. If you will follow retail traders, then obviously you will lose.

This special candle represents a sharp price reversal or rejection and often appears along a trend. Therefore, you should expect to find bullish and bearish pin bar candles on your chart. In addition, pin bars are only useful for trading when markets are trending.

What does a pinbar candlestick really mean

At the end of the second bearish impulse, the price action enters into a consolidation phase. Note that the consolidation resembles a symmetrical triangle. The upper level of this chart pattern could be used to close our short trade in this case.

You should consider whether you understand how ᏟᖴᎠs work and whether you can afford to take the high risk of losing your money. Please use the login you have previously been provided. The overall currency strength indicator first one is from the bitcoin market, hourly time frame. Having seen these indications of the Big Trades, one could more confidently enter long positions as the price began to rise.

Improves my understanding of technical aspect of price action. So… don’t treat all Pinbars the same because they’re not. Remember, the bigger the Pinbar , the stronger the price rejection. The upper wick shows the bulls were in control earlier but was eventually overcome by the bears. Click the ‘Open account’button on our website and proceed to the Personal Area. Before you can start trading, pass a profile verification.

  • The longer wick goes below the general price action, which means that the pattern is significant.
  • A type of pin bar candlestick in which long-tail wick is below the body of the candlestick is called bullish pin bar.
  • This is a situation where the initial pin bar pattern is followed by another pin bar.
  • Therefore, we confirm the reversal character of the candle.
  • Possibly maybe placing a buy stop order above the high of the pin bar.

My first script to identify pin bars with a predefined rules, any feedbacks are welcome. Body of the candle should be above the 50% of the day’s price range AND 2. Either the open or the close should be above the 30% of the day’s price range if both the above conditions are met then a bullish arrow is produced with “B”. Source code that allows to find bullish or bearish pin bars in any asset. After the rapid decrease the price enters a consolidation phase, which resembles a falling wedge chart pattern.


We can assume that If the price goes beyond the longer candlewick, then the pattern is considered unsuccessful. All those traders who are not in the market may feel they are missing out and will feel pressured to start buying. Premature short traders are liable to panic and cover with buy orders. There is a demo account built into the ATAS platform, so you can practice trading without risking your real capital. Number 3 indicates the VAH level, i.e. the upper limit of the value area where the balance was reached after the decrease. The pin bar appeared just around the VAH level, and this is the logical place for it to appear.

You now have some ideas on how to enter the market on pin bars and where to put your stop loss. So the next logical question becomes “Where should we exit our trade”. We hope that information presented in this article was useful for you. Pin bar Stock Technical Analysis 2020 trading may seem appealing to beginner traders, but simple strategies are likely to be disappointing. We have already mentioned that large volumes on the shadows can carry important information for reading market sentiment and price forecasting.

He is the most followed trader in Singapore with more than 100,000 traders reading his blog every month… I generally use the 200ma to define the trend, whether it’s sma, ema, wma, is not important — the concept is. Sure, you can use those levels as part of your trading plan. What you’re looking for is for the price to break higher and form higher highs and lows . I don’t know if I will now, but tks to your article I understand more about them. I have different trading philosophies, one of them is to ride a trend, while the other is, if I were to capture a swing, then I’ll exit at a point before opposing pressure sets in.

pin bar candle stick

I once believed the Pinbar trading strategy was the “holy grail” of trading. You may want to test the environment with virtual money with a Demo account. hawkish definition finance Once you are ready, enter the real market and trade to succeed. Place a Stop Loss points below the support line that caused the rejection of prices.

Inside Bar Trading Strategy

Pin bar patternis characterized by a long upper or lower wick with a small body relative to the size of the wick with little to no lower or upper shadows. Pin bar candle must form at the end of a trend (overbought & oversold condition). In particular, emotional control and discipline are two very important things that can greatly impact how traders perform.

pin bar candle stick

Also the body of the pin bar itself is a bit smaller than what we saw on the bearish pin bar in previous image. So long as the body of the pin bar is found at the bottom half of the candlestick and the majority of the wick is found at the top, the candle is considered to be a bearish pin bar. Pin bar candle consists of a small body and a long tail wick.

The Ultimate Guide to Pin bar Candlestick in forex

In case we couldn’t get through, we will try again at the same time the next day. ᏟᖴᎠs are complex instruments and come with a high risk of losing money rapidly due to leverage. I accept Client Agreement/Terms and Conditions and all risks related to trading operations. Rare types of charts, such as Renko, various types of Range, Reversal, Delta and others.

You are against the higher timeframe trend, and you’re also against the lower timeframe trend. You wait for the price to come into an area of support. Rayner Teo is an independent trader, ex-prop trader, and founder of TradingwithRayner. These areas can last weeks or months and are often tradable events when recognized. If the price comes to an area of value, then go long when you see a bullish Pinbar .

The pin bar candle is a pattern that price action creates on a chart as buyers or sellers have rejected a key price level. It can be a signal for a coming larger reversal in the current trend itself. Pin bar candles are a visual sign that the chart is losing momentum in a swing or trend. With this pin, you can see the body of the candle is not found right at the bottom like we saw in the previous image but is instead located a little bit higher.

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