March 17, 2015

Pin bar trading strategy

Pin or Pinnochio Bars are one of the most powerful tools a trader can have in their price action arsenal. They form very regularly and can be found across all time frames. The pin bar’s core purpose to help the trader identify potential reversals in the market. When pin bars form, it is a good sign the market is ready to move in the opposite direction.

Price action always tells a story. The story of a pin bar is is one where price moved to an area on the chart. The move is rejected by the market, and pushes price back to its original point of origin. Sometimes even beyond if it’s a good signal. Working with the logic of the rejection principle of pin bars, we can use them to:

  • Capture potential tops and bottoms to price movements
  • Identify breakout traps that can lead to powerful price reversal moves
  • Position into trending environments at excellent prices.

No comments:

Post a Comment