Pin-Bar Forex Strategy

[fxsusan]

Pin Bar is a popular Forex strategy which is based on the particular candlestick pattern. You can use this strategy on any major pairs and timeframe. Using longer-term timeframes would be more logical though. I advise 1H, 4H or daily charts. The “Pinbar” pattern was first introduced by Martin Pring.
Bearish Ping-Bar Pattern:

The pattern consists of three bars: the left eye, the nose and the right eye. The left eye should be a bar up. The nose bar should open and close inside the left eye, but its high should bulge much farther than the left eye's high. Both the nose bar's open and close should be located in the bottom. The right eye is where the trading happens. If you see this formation near a strong resistance level, you may think that the chance of being successful would be higher. Please have a look at the charts below:

Refer the figure-1 from attachments:

Bullish Ping-Bar Pattern:
The left eye should be a bar down. The nose bar should open and close inside the left eye, but its low should bulge much farther than the left eye's low. Both the nose bar's open and close should be located in the top 1/4 of the bar. Again, the right eye is where the trading happens. If you see this formation near a strong support level, you may think that the chance of being successful would be higher.


Aggressive Entry and Exit Conditions:
1. Aggressive entry option is to enter a position when in the right eye price retreats behind the left eye's close level.
2. Aggressive take-profit level may be placed farther (to the next strong support level, resistance for bullish positions)
3. Set stop-loss to behind the nose bar point (in this case, your reward/risk ratio may suffer).

Conservative Entry and Exit Conditions:
1. Conservative entry point is below (above for bullish set-up) the nose bar.
2. Conservative stop-loss can be set behind the nearest support/resistance level behind the eyes.
3. Conservative take-profit can be set immediately after the left eye low (high for the bullish set-up).

Please check the charts below to see real examples on GBP/USD:
Refer the figure2 from attachments:

 

[Patricia12]

Thanks fxsusan to share detailed info about Pin Bar Forex Strategy. I was searching something useful about it.

 

[Enzzo]

Pin Bar is a popular Forex strategy which is based on the particular candlestick pattern. You can use this strategy on any major pairs and timeframe. Using longer-term timeframes would be more logical though. I advise 1H, 4H or daily charts...........

Hi FxSusan,

IMHO to find a good looking pin bar is only one part of a good trading opportunity using that strategy...

as you are saying, the "location" where you find it, carries on way more importance, and it defines if it is a high probability trade to take or not.....
S/R, Fibo levels, Trend Lines, Ma's, or whatever you prefer to use to analyze the price action will do the trick... the more confluence of them in a certain level, the better.....

So, as I see it, one should have defined before hand the location where all this confluence is and where it is expecting a reaction from price, and only then, when price is trading on that "level", wait to see if a Pin Bar or any other candlestick pattern presents itself to confirm that your analysis was spot on....

just my 2 cents

 

[neil]

Thanks fxsusan to share detailed info about Pin Bar Forex Strategy. I was searching something useful about it.

Pin Bar strategy also discussed here:

Jankone M5 thread @ Forex Factory

 

[Enzzo]

Pin Bar strategy also discussed here:

Jankone M5 thread @ Forex Factory

Another great educational source on the matter here:

james16 Chart Thread @ Forex Factory

 

[dazzer_fx]

Pin Bar is a popular Forex strategy which is based on the particular candlestick pattern. You can use this strategy on any major pairs and timeframe. Using longer-term timeframes would be more logical though. I advise 1H, 4H or daily charts. The “Pinbar” pattern was first introduced by Martin Pring.
Bearish Ping-Bar Pattern:

The pattern consists of three bars: the left eye, the nose and the right eye. The left eye should be a bar up. The nose bar should open and close inside the left eye, but its high should bulge much farther than the left eye's high. Both the nose bar's open and close should be located in the bottom. The right eye is where the trading happens. If you see this formation near a strong resistance level, you may think that the chance of being successful would be higher. Please have a look at the charts below:

Refer the figure-1 from attachments:

Bullish Ping-Bar Pattern:
The left eye should be a bar down. The nose bar should open and close inside the left eye, but its low should bulge much farther than the left eye's low. Both the nose bar's open and close should be located in the top 1/4 of the bar. Again, the right eye is where the trading happens. If you see this formation near a strong support level, you may think that the chance of being successful would be higher.


Aggressive Entry and Exit Conditions:
1. Aggressive entry option is to enter a position when in the right eye price retreats behind the left eye's close level.
2. Aggressive take-profit level may be placed farther (to the next strong support level, resistance for bullish positions)
3. Set stop-loss to behind the nose bar point (in this case, your reward/risk ratio may suffer).

Conservative Entry and Exit Conditions:
1. Conservative entry point is below (above for bullish set-up) the nose bar.
2. Conservative stop-loss can be set behind the nearest support/resistance level behind the eyes.
3. Conservative take-profit can be set immediately after the left eye low (high for the bullish set-up).

Please check the charts below to see real examples on GBP/USD:
Refer the figure2 from attachments:

Are you suggesting that taking Pin Bars in isolation as above will create a
positive expectancy over time? If so I would have to disagree, if you
think that is incorrect why not start a journal thread to prove it to yourself
and others.

Pin Bars have been 'done to death' on this site, try doing a search! I think the
general consensus is that they help with continuation of trend or rejection of
certain levels but even then I'm not convinced. The thing is by using diferent
time frames you are back fitting to find your setup, a Pin Bar on a lower time
frame could be a overbar on another, so why just pin bars?

Now, if you had started a thread where the setup was taken after pin bar
stops were taken, especially when the pin is against the trend then that would
have got my interest.

As I said, I'd love you to prove me wrong with the journal.

 

[rsh01]

Hi FxSusan,

IMHO to find a good looking pin bar is only one part of a good trading opportunity using that strategy...

as you are saying, the "location" where you find it, carries on way more importance, and it defines if it is a high probability trade to take or not.....
S/R, Fibo levels, Trend Lines, Ma's, or whatever you prefer to use to analyze the price action will do the trick... the more confluence of them in a certain level, the better.....

I disagree. why if your trading using key levels looking for a certain price reaction to that level then who cares what type of bar it is. Also as dazzer rightly points out they can represent diff bars on diff t/f's. Also if price has say bounced off a significant s/r level and forms a pin bar and your entering on the close of that bar then the move has already in part been made. Why not just fade at that significant level - I.e. At the start of the move?

 

[Enzzo]

I disagree. why if your trading using key levels looking for a certain price reaction to that level then who cares what type of bar it is. Also as dazzer rightly points out they can represent diff bars on diff t/f's. Also if price has say bounced off a significant s/r level and forms a pin bar and your entering on the close of that bar then the move has already in part been made. Why not just fade at that significant level - I.e. At the start of the move?

hehehe.... I was writing about Pin bars (candle formations) here, which was the subject of FxSusan's first post .....
but I never said that I traded off them.... I kind of see Candles formations as a lagging indicator too, as the move has already been produced in order to the Pin bar appears at certain level... so I try to enter the closest to the movement source as possible...

 

[rsh01]

hehehe.... I was writing about Pin bars (candle formations) here, which was the subject of FxSusan's first post .....
but I never said that I traded off them.... I kind of see Candles formations as a lagging indicator too, as the move has already been produced in order to the Pin bar appears at certain level... so I try to enter the closest to the movement source as possible...

You were giving him advice on how to trade using pin bars i.e. where there is a confluence of other factors/levels. I thought it appropriate to give my opinion why I wouldn't trade using a pin bar - its called balancing the discussion (as others have done also). The fact that you don't follow the advice you gave is slightly bizarre, especially as you agree (cos you trade this way) that you can enter at better prices by ignoring the bar type (which cld be a pin bar on one time frame and a reversal on or whatever on lower t/f) and to trade the level. Why not tell the OP this? Its surely relevant from your experiences?

 

[The Leopard]

All this formation shows you is that on a given timescale price moved in one direction, reversed and moved in the other, and finished near where it started.

That's all.

You'll probably want to move beyond this at some point.

 

[Enzzo]

..............The fact that you don't follow the advice you gave is slightly bizarre, especially as you agree (cos you trade this way) that you can enter at better prices by ignoring the bar type............

Hi RSH01,

Sorry, but I don't consider my post about "pin-bars" bizarre at all.....

A lot of people go step by step, as I also did personally, so I began to trade of candle formations in key levels till I little by little i realized that I could get in at "the source" of the move a lot of times, with some grade of accuracy....

Apart from this, if I am not 100% convinced on the level I am looking to play, I might wait for some kind of "indication" that this level is "good" to go, via "candle formation"..... then, not entering by the book, but trying to get in on a pullback in smaller tf to get a better price, closer to the level.... but this is just me, and it hasn't to be the best way or the right way to do things for others too....

But as I am saying above, I cannot agree more with you that it is possible to enter closer to the source that originates the Pin bar in most of the cases if you look for the right clues before hand...

You were giving him advice on how to trade using pin bars i.e. where there is a confluence of other factors/levels. I thought it appropriate to give my opinion why I wouldn't trade using a pin bar - its called balancing the discussion (as others have done also).

Do not take anything I am saying like a critic to you posting whatever you feel like.... Discussion is a great way to learn from each other experiences

 

[Enzzo]

All this formation shows you is that on a given timescale price moved in one direction, reversed and moved in the other, and finished near where it started.

That's all.

You'll probably want to move beyond this at some point.

100% agree...

 

[khaleeq655]

Pin Bar is a popular Forex strategy which is based on the particular candlestick pattern. You can use this strategy on any major pairs and timeframe. Using longer-term timeframes would be more logical though. I advise 1H, 4H or daily charts. The “Pinbar” pattern was first introduced by Martin Pring.
Bearish Ping-Bar Pattern:

The pattern consists of three bars: the left eye, the nose and the right eye. The left eye should be a bar up. The nose bar should open and close inside the left eye, but its high should bulge much farther than the left eye's high. Both the nose bar's open and close should be located in the bottom. The right eye is where the trading happens. If you see this formation near a strong resistance level, you may think that the chance of being successful would be higher. Please have a look at the charts below:

Refer the figure-1 from attachments:

Bullish Ping-Bar Pattern:
The left eye should be a bar down. The nose bar should open and close inside the left eye, but its low should bulge much farther than the left eye's low. Both the nose bar's open and close should be located in the top 1/4 of the bar. Again, the right eye is where the trading happens. If you see this formation near a strong support level, you may think that the chance of being successful would be higher.


Aggressive Entry and Exit Conditions:
1. Aggressive entry option is to enter a position when in the right eye price retreats behind the left eye's close level.
2. Aggressive take-profit level may be placed farther (to the next strong support level, resistance for bullish positions)
3. Set stop-loss to behind the nose bar point (in this case, your reward/risk ratio may suffer).

Conservative Entry and Exit Conditions:
1. Conservative entry point is below (above for bullish set-up) the nose bar.
2. Conservative stop-loss can be set behind the nearest support/resistance level behind the eyes.
3. Conservative take-profit can be set immediately after the left eye low (high for the bullish set-up).

Please check the charts below to see real examples on GBP/USD:
Refer the figure2 from attachments:

Aggressive entry method needs to elaborate in plain language.... https://howtotradeforexmarket.com/4-6-PinBarForexTradingStrategy.html

 

[Kevin FD]

got a nice description with some fine lines , its not too long its really good , thanks for your nice share , happy trading

 

[Henow1969]

If we always use the pin bar strategy to trade with us, we will always be able to make a profit because it looks at the shape of the market and continues to press, but not so strong to continue the trend the following time. It will be banked and against the current trend.

 

[tomorton]

Pin bars are quite impressive candlestick features when seen on a chart and they are easy to distinguish. But my take is that they are better employed as exit signals for winning positions than entry signals: or as danger signals for anyone contemplating taking a with -trend position.

Its the exit that makes the money, not the entry.

 

[ffsear]

Issue with pin bars is they are very easy to spot when visual back testing. Trading them live , not so easy. The skill is picking the right ones at the right time

 

[DT5]

Anyone care to share some long term results ?