pin bar experiment

[Shakone]

well i changed the rules for the pin, don't know what to do about the 1:1 though, it is what majordutch defined in his thread so i'm going from that. plus i know pins are said to reverse the trend, and i would say that a countertrend should at least last one bar length and that's being generous.

It's tricky when it gets subjective. If you rely on people posting pins, then you'll get things that aren't pins, your results might be heavily weighted by a good trader who selects good trades, or a bad trader who selects bad trades, so you'd be measuring something other than whether the pins work.

Why not just backtest it with some rules, and report the results? Faster than waiting for calls.

From what I've read about pinbar trading that T_Dante or James 16 propose, some common rules seem to be:

(for longs)
-open and close of the bar in top portion of the bar (top third/quarter/fifth whatever)
-low of pin must be below the low of previous bar (rules out inside bars)
-high of pin must be lower than hig of previous bar (rules out outside bars)
-takes place at a swing low/high (you could make the low lower than previous 3/4/5 bars or something like this).
-taken during common market hours if short timeframe

 

[scose-no-doubt]

Hi Tom,

Everyone know what pin bars/candles are and we are all able to discern the pit falls of the do work/ don't work argument.

No retrospective trades.

 

[scose-no-doubt]

Totally and utterly irrelevant to the thread.

You're discussing profitable trading using price action; we're strictly looking at the classic, rules based, pin bar set-up and whether they "work" absolutely and utterly on their own. Whether or not you believe it's a waste of time is besides the point as it requires absolutely zero input from yourself.

Respectfully, if you want to help people to become profitable using this or any other methods or to even discuss other, more appropriate, more feasible, ways of trading it really belongs in another thread.

 

[DionysusToast]

For this experiment, you should perhaps define a set of markets and timeframes.

Otherwise:

- the 'pro' pin bar people can look at different instruments and adjust timeframes to pull up charts to show it works.

- the 'anti' pin bar people could do the same thing.

So - to make this a legitimate forward test - choose markets & timeframes.

 

[Mata Nui]

Perhaps everyone reading this thread should take a look at Pocrels journal on trading pin bars at pivot points. He trades them really well but despite the impression that he uses a rules based approach it is not this that makes him successful. I created an indicator and an EA for the system as described and it does not make money.

Its back to the old issue that it is not the entry that makes the trade (although a good entry helps). Patrick knows what trades to run and which ones to cut (either at small profit /BE or for a small loss before they hit the SL).

Without defining parameters for what you consider successful pins what is the point of arguing about if they work or not. How are you defining a pin that works, one that goes to 1X risk or one that just gives you a couple of points?

 

[Mata Nui]

Whats happened to the thread? I just read it now it all looks different.
Yippee 300th post

 

[squall321]

For this experiment, you should perhaps define a set of markets and timeframes.

Otherwise:

- the 'pro' pin bar people can look at different instruments and adjust timeframes to pull up charts to show it works.

- the 'anti' pin bar people could do the same thing.

So - to make this a legitimate forward test - choose markets & timeframes.

ok good points

for markets i'd say forex (eurusd, gbpusd, usdjpy, eurjpy, usdchf, audusd, usdcad, eurchf and eurgbp)

timeframe 1hr, since the bar will appear the same regardless of timezone

 

[wackypete2]

Were there some posts removed? This thread doesn't read right.

Peter

 

[robster970]

What's the rationale behind a pin bar? What is it about player interaction around it that should validate it as a strategy?

Genuinely curious...

It's provenance is around the notion that money is hoovering up that level with such voracity that you would be a dimwit to trade against it.

Apparently the trick is to get in once you've got a confirmation candle after the pin forming (it's short for Pinocchio - big nose - geddit?) but anybody with their wits is likely to pile in once the vol goes through the roof and get better trade location, otherwise you've missed a large part of the move and would have to have a greater risk for a smaller reward.

Sorry Squall - not wanting to derail. Over and out.

 

[megamuel]

Just thought I'd post these indicators in case they are of benefit to anyone. I had them coded up a while ago. The Pin Bar Indicator allows you to select the open and close limits. For example, the presets are Open = 33, Close = 33. There for the pin bar must open in the top or bottom 33% of the range and close in the top or bottom 33% of the range. You could change it to be, for example, open = 40, close = 10. So the open can be in the top or bottom 40% and the close must be in the top or bottom 10%. Obviously the open and close must both be in either top or bottom.

The Pivot Point indicator calculates standard pivot points but with a shift feature so you can try them on different time zones.

Good luck,

Sam.

 

[portabledvd]

A little tip.

I think people only look at the bar and not how the bar is formed from start to finish. So look at the underlying structure of the bar and that will tell you something a little more. People blindly trade the formation without looking underneath it.

 

[squall321]

gbpusd

 

[squall321]

gbpusd

failed

 

[portabledvd]

I would say it succeeded. It gave about 20 points. How can that be called failed?

 

[Poem 101]

gbpusd

Hi Squall

I understand it's ok to do some post-trade analysis? If not, pm me and I'll delete the post.

I don't really know about pins, but looking at the entry:

I see a well-defined (with the exception of one spike) bear channel. This is potentially a bull flag. A channel is just a sloping trading range, in this case composed mostly of dojis, with the bodies tending to cluster in the centre of the range. Granted, most ranges will tend to finally break out in the direction of the prior trend, but in this case I see no evidence of prior bull strength. To me, what you did here was buy at the top of a trading range with no convincing breakout set up. Over time that is a losing strategy.

If I had to trade this (and I wouldn't by choice) I'd be on a low timeframe looking to fade the extremes back to the other side of the range. Specifically, I'd want to fade weak bull set ups at the top and weak bear set ups at the bottom to take advantage of the covering by the disappointed weak breakout traders exiting their positions and the fact that the middle of the channel is clearly a place where bulls and bears agree so there's an almost gravitational pull towards it.

As I say, I don't know about pins - I can't see the attraction. I have read some of the james16 thread out of curiosity though, and from what I can remember I think this pin would be criticised because it's small, got a bad close, not at an area of real significance (this last paragraph might be wrong, like I say I've never traded or even got this whole pinbar thing).

 

[scose-no-doubt]

Entry at 95 stop at 105

 

[scose-no-doubt]

Would have worked if the stop had been placed above the pin. Dunno why I said 115 tbh.

 

[brewski1984]

Given up on this already?

 

[scose-no-doubt]

It seems everyone else has.

 

[brewski1984]

I wrote that reply about 3 hours ago on my phone and forgot to post it. Then when I went back on my phone I thought well it's been over a week nobody would have posted on here in the last couple hours so I post my reply without checking and you'd posted! What were the chances of that!