PIN BAR TRADING STRATEGY

The forex market is full of opportunities, however, these opportunities are only visible to experience traders who possess the right knowledge to identify them, when they appear.

The pin bar trading strategy is one of the easiest to apply because of its unique candlestick pattern with a tail and a real body.

As a forex technical analysis trader, to maximize your profit using a pin bar trading strategy or any trading strategy you must first understand price action and market structure.

IS PIN BAR A GOOD STRATEGY?

In my years of trading, I’ve learned that there are no good or poor trading strategies since traders approach the market differently.

What matters most is that you want to see consistent profit and growth in your account at the end of the day.

Having said that, here is why Pin bar is a good strategy.

  1. the pin bar is easy to identify
  2. mostly formed on supply and demand zones
  3. forms on a single candlestick
  4. occurrences are medium
  5. give high-yield setup
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PIN BAR TRADING STRATEGY

pin bar trading strategy

 Pin bars trading strategy entails looking for trading opportunities in demand and supply zones, with the beginning of a pin bar candle pattern signifying a market reversal. When paired with market structure knowledge, they are particularly reliable for predicting the near-term, and occasionally long-term, the direction of price.

HOW DO YOU USE THE PIN BAR STRATEGY?

how do you use pin bar strategy

If you are reading this, I guess you have heard about Pin bars and you are not sure how to properly use them. Well, read on as I will show you what you need most to use Pin bar strategy.

The only thing you need to learn about pin bar strategy is that it works along with price action and market structure.

MARKET STRUCTURE

market structure

Let me explain:  Forex technical analysis is defined by market structure and since the pin bar is a candlestick pattern and aligns with supply and demand zones, then the best way to use the pin bar strategy will be to understand market structure.

Market structure is everything with pin bar strategy, in it, you will find, supply and demand, support and resistance, order blocks, and higher highs and lows. Etc.

This is why market structure is essential to have a successful pin bar strategy.

That being said, before you perfect any pin bar trading strategy, learn about market structure

HOW DO YOU TRADE WITH PIN BAR?

how do you trade with pin bar

Without wasting your time, let me go straight to the point, pin bars are best traded in supply and demand zones, where they are possible reversals as big banks and institutions are interested in those supply and demand areas.

Pin bars are also best taken on higher timeframes.

PIN BAR CANDLE MEANING

The pin bar candle is a reversal pattern that signals that the market has rejected the price at a specific price level. It is one of the most easily identified candlestick patterns on Forex charts.

It is produced on a single candle.

When a pin bar appears on a forex chart, it indicates a possible change in the dominant trend.

The best pin bars can be found in supply and demand zones on higher timeframes.

DO PIN BARS IN FOREX FAIL

If you’ve read any of my previous articles, you’ll know that no forex trading strategy should be used in isolation.

All market dynamics should be used in conjunction to provide a strong and certain direction for the domination trend.

Market structure and technical analysis can summarize all of these market forces.

For example, if you combine supply and demand with the pin bars strategy, you will identify numerous high-yield setups.

To answer your question, pin bars in forex only fail when utilized independently.

 CONCLUSION

Whatever trading technique you choose as a forex trader, keep in mind that basic principles such as market structure and price movement are unavoidable because they constitute the cornerstone of a successful trader.

In all my years of trading, I have yet to come across a successful forex trader who does not comprehend the forex market structure.

It’s time to ditch the sophisticated lagging indicators and focus on real-time market prices.

Say goodbye to trailing indicators and yes to naked trading, the Fibonacci tool, trend lines, and chart patterns, among other things.

PIN BAR CANDLESTICK

True, a pin bar candlestick is a particular kind of candlestick that denotes a price reversal, but is that all there is to it? A working knowledge of price action is necessary to apply it properly to a live chart.

Everyone would be wealthy if pin bar candlesticks were the only thing needed.

You will have a clear understanding of the connection between price action and pin bar candlestick application at the end of this post.

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IS A PIN BAR BULLISH OR BEARISH?

In either a bullish or bearish market, a pin bar might form. The bottom of a sustained bearish trend is typically where the bullish pin bar forms.

These bearish pin bars typically appear at levels of support. When this occurs, the market’s primary trend shifts from bearish to bullish.

And it is quite the opposite for pin bar formation at resistance level.

RELATED: PIN BAR REVERSAL

RELATED: PIN BAR TRADING STRATEGY

PIN BAR CANDLESTICK

Pin Bar candlestick

Pin bar candlestick has a long tail, and a short body, it is easy to spot and it is best employed at the peak of a trending market since it signals a sharp reversal in the main trend because price has been rejected at a given point.

types of pin bar candlestick

WHAT DOES A BULLISH PIN BAR MEAN?

A bullish Pin bar indicates that lower prices have been rejected.

The lower wick of the pin bar candle indicates that the bears were in charge earlier but were eventually defeated by the bulls. The best bullish pin bar formations occur at support levels.

PIN BAR CANDLESTICK PATTERN

pin bar candle stick pattern

Of all the candle stick patterns, the pin bar is one that is easily identified. The pin bar candle can be seen across timeframes and it can be formed in a bearish or bullish market.

It is formed in a single candle. When formed it indicates a string rejection in price at that level, lower or higher.

THE BEST TIME TO TRADE PIN BAR CANDLESTICK

best time to trade pin bar candlestick

Pin bars are powerful market setups, but not all pin bars are profitable. For this reason, the optimum time to trade pin bar candles is at significant support and resistance levels in higher timeframes.

By doing this, you can narrow your attention to setups with a high chance and moderately frequent occurrences.

IS PIN BAR A GOOD STRATEGY?

This is a critical question that forex traders frequently ask.

For the record, there are no perfect strategies for trading the forex market because market behavior changes due to trader sentiments and worldwide activity; yet, price action and market structure remain consistent.

To address your question, using a pin bar in conjunction with market structure and price action concepts is a good strategy. For instance, where or when is the ideal time to trade a pin bar?

Another idea would be to consider whether a pin would work better at a lower or higher timeframe. You can trade the best of pin bar setups by answering these questions.

In conclusion, any trading strategy including a pin bar would work absolutely well when you understand price action and market structure. Keep reading below you will find the best time to trade pin bar when they are formed.

HAMMER PIN BAR

Hammer pin bar is a unique candlestick pattern that indicates a price rejection; it can be bullish or bearish.  It is known for its long tail and a small real body.

PIN BAR CANDLE VS HAMMER

There is no difference between a pin bar and a hammer. However, the Hammer pattern is a bullish candlestick pattern that signals a trend reversal.

TYPES OF PIN BAR CANDLESTICK

types of pin bar candlestick

There are basically two types of pin bar candlestick. The bullish and Bearish pin bar

  1. BULLISH PIN BAR

It has a long lower wick, a small candle body, and a little higher wick.

  • BEARISH PIN BAR

It has a long upper wick, a small candle body, and a short lower wick.

BEARISH PIN BAR CANDLESTICK

A bearish pin bar candlestick signal has a lengthy upper tail, indicating a quick rejection of higher prices with the implication that prices will drop in the near future, in simple terms, a bearish pin bar is formed when buyers start the session and are in control, but price reaches a level that is quickly rejected, sellers take over and dominate the rest of the session, closing out at a lower price.

FAKE PIN BAR CANDLESTICK

fake pin bar candlestick

Fake pin bar candlesticks are failed patterns since they do not form at multiple levels of support and resistance and should be avoided.

Many failed pin bar setups may be found on the forex chart. Having stated that, your best pin bars will be found in concentrated locations of multiple support and resistance.

CONCLUSION

One thing to remember is that pin bars are not traded in isolation; for a successful outcome, a good pin bar setup must correlate with other technical trading techniques.

At the end of the day, in all thy getting’s,  get an understanding of market structure.

PIN BAR REVERSAL

When used correctly, reversal markets are incredibly effective.

Pin bars can be seen at important levels on all of the forex chart time frames. The question is, “What does pin bar reversal indicate” when it occurs in the market, and how effective they can be?

Our discussion in this article will center on pin bar reversals and how to profit from them when they occur.

HOW DO YOU TRADE A PIN BAR REVERSAL?

In the forex market, a pin bar formation does not ultimately mean a market reversal as there are many failed pin bar setups.

To maximize pin bar reversal trading, they should not be traded in isolation. There are markers to look out for that support the pin bar reversal.

  • Support and Resistance

Support and resistance are essential parts of forex trading; it is important in making trading decisions especially when it is combined with pin bars and multiply timeframe analysis.

Because there is a time pin bar setup fails, it is best to trade pin bars formed at major support and resistance levels.

  • Dominant trend

There is a forex saying that says to follow the trend, the trend is your friend. When you decide to trend against the trend, it becomes your enemy. Any pin bar formed in the forex market will be much more effective if it supports the dominant trend.

dominant trend
  • Higher timeframe

The higher timeframe, dominant trend, support, and resistance, all work together for a valid pin bar entry. The higher timeframe gives a better pin bar formation as they are not formed every time like in the lower timeframes.

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PIN BAR REVERSAL

Pin bar reversal

Pin Bar Reversal is a sharp rejection of price at a lower or higher level, typically at support and resistance zones, It also stands out for having a long tail and a little actual body.

RELATED: BULLISH ORDER BLOCK INDICATOR

RELATED: WHAT IS A BULLISH ORDER BLOCK

IS A PIN BAR BULLISH OR BEARISH?

A pin bar can be seen both in a bullish or bearish market. A pin bar formation is an indication that the price was rejected at a higher or lower level.

is a pin bar bullish or bearish

On a bearish market, the pin bar can be identified with a long tail at the top and a real body at the bottom. While in a bullish market it can be identified with a long tail at the bottom and a real body at the top.

Pin Bar Bullish or Bearish
Bearish Pin Bar

WHAT DOES A BEARISH PIN BAR MEAN?

A bearish pin bar signal has a lengthy upper tail, indicating rejection of higher prices and implying that price will decline in the short term. It also means that sellers are stronger than buyers in the market.

PIN BAR VS HAMMER

A pin bar and a hammer are one and the same, as they both have a long tail and a small real body; however, a hammer is a bullish candlestick pattern. In general, it is much easy to use a generic name “PIN BAR” than to use their individual candlestick names like hammer and shooting star.

PIN BAR PATTERN

A pin bar pattern is made up of one price bar, generally a candlestick price bar that signifies a sharp price reversal and rejection. These pin bar candlestick patterns are easy to identify in a market because of their unique pattern.

PIN BAR WITH NOSE

A pin bar has two important parts, the real body, and the tail. Sometimes the tail is called the nose.

See the image below.

pin bar with nose

PIN BAR CANDLE MEANING

A pin bar candle means that price was rejected at a lower or higher level. A price rejection at a lower level shows that buys have entered the market and a price rejection at a higher level shows that sellers have entered the market.

Note that the pin bar is formed in just one candle.

CONCLUSION

A pin bar is a strong indication of the market activity; they should be taken seriously when they are formed as they are pointers to the next dominant trend of the market.

Just because pin bars are formed in a market does not mean is a perfect entry. Pin bars should not be traded in isolation, pin bars must align with the trending market for a high probability entry.

Lastly, from my experience I have come to see that pin bars are best traded on higher timeframes; this will enable fewer entries with high-yield setups.

WHAT IS PIN BAR

The question “what is pin bar?” is frequently asked by newcomers to the forex market. The pin bar is super easy to identify on the forex chart because it is the simplest candlestick pattern to recognize.

The pin bar can be found on all time frames; but, in my experience, it works best on higher time frames.

The Japanese candlestick best illustrates the pin bar visualization on the chart compared to the other two price visualizations; line chart and bar chart.

Pin bars can form in both bullish and bearish markets, and when they do, they should not be traded in isolation; instead, search for other market structures or candle stick pattern confirmations that support the pin bar before entering a trade.

The steps outlined above will assist you in filtering out fake pin bars.

HOW DO I FIND PIN BAR?

How to find Pin Bar

Pin bar is pretty easy to find.

To find a pin bar, look out for candlestick pattern with a long wick and a small body. In my experience it is much more effective when pin bars are found at the end of a trend; the pin bar can be found at the end of a trend indicating a reversal, and it can also be found at a continuation trend after a retracement.

If you know how to use the Fibonacci tool, pin bars can also be found at key Fibonacci retracement and reversal levels.

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WHAT IS PIN BAR

What is Pin Bar

A pin bar is made up of one price bar, generally a candlestick price bar that signals a strong price reversal and rejection.

The area between the pin bar’s open and close positions is referred to as its “real body,” and pin bars often have smaller real bodies in relation to their long tails.

They are the simplest candlestick pattern to recognize.

RELATED: PIN BAR REVERSAL

HOW DO YOU TRADE WITH PIN BARS?

It is no doubt that pin bars are powerful candlestick patterns, however, they should not be traded in isolation because there are many cases of failed pin bars in the forex market.

That being said, this is how to trade pin bars.

  1. Look out for pin bars that appear in support and resistant zones
  2. Over bought and over sold zones
  3. An engulfing or bullish/bearish candle that supports the pin bar.

See the image below;

How do you trade with pin bars

HOW IS PIN BAR FORMED?

A pin bar is formed when there is a price rejection possibly at key resistant and support zones; this price rejection indicates a large volume of buyers or sellers in the market possible pending orders.

To put it in simple terms, when there is a large volume of (pending) orders in a key support or resistant zone and price reaches that zone; and the pending order is triggered across all brokers and traders, then a pin bar can be formed.

WHAT DOES A BULLISH PIN BAR MEAN?

What does a Bullish Pin bar mean

A bullish Pinbar means that lower prices are being rejected. The lower wick of the pin bar candle indicates that the bears were in dominance earlier but were eventually overpowered by the bulls.

This bullish pin bar is common in the forex market at oversold and support levels and they are seen across all timeframes, however it is more effective on higher timeframes.

PIN BAR FOREX

The pin bar is the easiest candlestick pattern to identify because of it unique long wick and small body. Because the pin bar is a power reversal candle, this does not mean that all pin bars are tradable as there a many failed analysis after a pin bar formation.

This is why pin bars in forex are not traded in isolation.

Here are tools and confirmations to use when trading pin bar forex.

  1. Fibonacci tools
  2. Support and resistant levels
  3. Over sold and over bought
  4. Demand and supply levels
  5. Bullish/bearish candle engulfing
  6. Multiple timeframe analysis

BEARISH PIN BAR

Bearish Pin Bar

A bearish Pinbar means that higher prices are being rejected. The higher wick of the pin bar candle indicates that the bulls were in dominance earlier but were eventually overpowered by the bears.

This bearish pin bar is common in the forex market at overbought and resistant levels and they are seen across all timeframes, however it is more effective on higher timeframes.

PIN BAR VS HAMMER

The argument of pin bar vs hammer has lingered for a long time among forex traders, in this article you are going to know in lay mans term the difference between pin bars and hammers.

The pin bar is a more generic term to use for any candle with a long wick and a small body whiles the hammer is a bullish candlestick pattern that implies a trend reversal.

A Bullish Pin Bar is the Pin bar version of this.

In theory, they are the same thing; in my years of trading, I have noticed that older traders refer to it as a hammer, whereas newer traders refer to it as pin bars.

PIN BAR TRADING STRATEGY

Pin Bar trading strategy

When used correctly, the pin bar trading approach can be extremely effective.

In the forex market, not every pin bar should be traded because there are many failed pin bar setups due to incorrect application.

You will know the best pin bar setups to take at the end of the post since they will align with the market structure at the moment of entry.

To have an effective pin bar trading strategy, here are key points to look out for;

  1. Pin bars are much better on key support and resistant levels
  2. Fibonacci retracement and reversal levels
  3. Better pin bars on higher timeframes
  4. Over bought and oversold levels

PIN BAR PATTERN

A pin bar pattern is a Japanese candlestick that indicates a quick price rejection at a lower price; the pin bar pattern is one of the most effective reversal candlestick patterns every trader should know.

The pin bar pattern can be recognized with it long wick and small body. It can be formed both in down and up trend.

After a pin bar pattern formation, you will need an extra confirmation before entry.

TYPES OF PIN BAR CANDLESTICK

types of pin bar candlestick

There are basically two types of pin bar candlesticks;

BULLISH PIN BAR: it has a lower long wick and a small candle body.

BEARISH PIN BAR: it has an upper long wick and a small candle body.

CONCLUSION

As a trader, make sure your pin bar strategy is in line with the real-time market structure before you trade it. Through my years of trading I have seen that when pin bars are implemented correctly, the returns are fantastic.