Pin bar price action method
A pin bar is a reversal signal on a chart which highlights an obvious change in sentiment during that period.
This bar has a long tail with closing price near the open.
Bar looks like a pin thus the name Pin-Bar - occurs after an extended trend move up or downward.
This reversal is confirmed after market closes below the candle that precedes this pattern. Below the reversal is confirmed after the market closes below the blue candle that preceded this candle.
Combining with line studies:
This signal can be combined with other line tools such as Support & Resistance levels, Fib retracement levels and trendlines can be used together with this signal to generate buy/sell trades.
Support and resistance
A pin bar that forms after trade price touches an important support or resistance zone can be used as a trade signal to enter in to the market. When this pattern forms the trades taken should be in the direction opposite of the tail.
If the market moves up this forms a pin bar with tall upper tail, then the signal is to short.
If the market moves down the forms a pin bar with tall lower tail, then the signal is to long.
Combining with Support & Resistance
Trendlines and moving averages
Pin bars that form after price touches a trend line or moving average can be used as signals to enter the market.
Combining with Trend Lines
Combining with Moving Averages
Gold Fibonacci Retracement Areas
Pin bars that form after price touches a Fib retracement level can also be used as signals to enter the market.
Combining with XAUUSD Fibo Retracement Zones
These patterns are often developed near extremes in market swings, & they often happen at after false break-outs. This is why this pattern is used to place trades in the direction opposite of the tail.
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