Pin Bar Trading Strategy: Everything You Need to Be Profitable

by Justin Bennett  · 

January 2, 2023

by Justin Bennett  · 

January 2, 2023

by Justin Bennett  · 

January 2, 2023


The pin bar is by far my favorite candlestick pattern in the Forex market.

In this lesson, we’re going to cover pin bar characteristics, how to know if a setup is worth trading, and entry and exit strategies.

As always, the term ‘bar’ is interchangeable with ‘candlestick’,

However, the common term has always been “bar” and not “candlestick”.

What is a Pin Bar?

Before getting into the actual Forex pin bar trading strategy, we need to understand the characteristics.

forex pin bar candlesticks

Let’s start with the tail, which is its defining characteristic and is also sometimes called the wick or shadow.

The tail of a pin bar should be at least 2/3 the length of the entire bar.

The longer, the better, but it must make up at least 2/3 of the bar from end to end.

Notice in the image above, the tail is about 3/4 of the entire bar, so this qualifies.

The body is also important as it represents the open and close of the pattern.

The open and close should be close together; the closer, the better.

The body should also be close to the end of the pin bar. Notice how close the open and close are to the nose.

Last but not least, the nose.

While not as important as the tail or body, the nose is important only as it relates to the tail and body.

This is because if the tail is at least 2/3 of the entire bar and the body is small, then the nose should also be relatively small.

Know too that the pattern doesn’t need a nose to be valid.

Sometimes it’s non-existent if the open or close occurs at the extreme end of the pin bar.

Here’s a short video explanation of the characteristics.

 

The Two Types of Pin Bars

There are two main types of pin bars as it relates to price action patterns that are taught in my price action course.

Most traders assume the pin bar is only a reversal pattern. And while it can signal a reversal, it can also be a continuation pattern.

First, let’s look at the more common way to trade pin bars as a reversal pattern.

Pin bar reversal pattern

pin bar reversal pattern

The reversal pin bar (above) is best played in a ranging market or on a pullback within a larger trend. Let’s look at both in action.

Below is a great example of a reversal that formed after price broke through support and then retested it from the other side as resistance.

This is actually a pattern that’s still taking shape as I type this.

pullback pin bar at resistance

Here are two more examples that occurred at range highs.

pin bars in ranging market

So far we’ve seen pin bars that form on pullbacks as part of a larger trend as well as ones that form in ranging markets.

Now let’s look at the less common way to trade them as a continuation pattern.

Pin bar continuation pattern

The differentiating factor here is that the continuation pattern doesn’t have a pullback (or very little) relative to the examples above.

pin bar continuation pattern

The key to this pattern is that the pin bar must form in the direction of a trending market.

Notice the pin bar just in front of the one I’ve identified in the chart above, the one that’s facing the other direction.

It’s also a valid pattern.

However, it’s going against the trend, so it would not make for a good trade.

Here’s a zoomed-out chart of the same setup to see what I mean…

forex pin bar patterns on daily chart

I wanted to put this chart up for three reasons.

  1. To show that our pin bar would have given us a nice gain because it’s well-formed and in the direction of a strong trend
  2. The first pattern that formed in the chart above was against the trend, so it would have been a “no trade” for us
  3. The reversal pin bar I pointed out in the chart above is technically perfect. However, it would have been a “no trade” for us. If you said because it’s against the trend, you’d be right! But there’s another reason why we wouldn’t have traded that reversal and it’s described in the next section.

Pin Bars and Confluence

Confluence is the coming together of two or more “things”. 

For Forex traders, confluence means the coming together of, or combination of, two or more price action patterns, levels, or indicators.

Let’s look at the setup below, which is the exact same setup we looked at before, only this time we’ll start identifying our “factors” of confluence.

pin bar at key level

Let me clarify what’s happening here by identifying the various factors at work.

To make this as applicable as possible, I’ll go through each factor as if I were doing my own analysis.

  1. Well-formed pattern rejecting previous resistance level, now acting as support
  2. The trend is clearly up
  3. The pin bar is rejecting the 8-day EMA, which is intersecting the horizontal support level
  4. No immediate resistance above the pin bar (it has room to run)

So there you have it, a simple pre-trade analysis using confluence factors. It’s really that simple.

I should point out that #4 above isn’t technically considered a confluence factor, but clearly identifying support and resistance levels is an extremely important part of any pre-trade analysis.

You’re probably wondering what the two moving averages are all about.

Well, I use the 10 and 20-period EMAs in my trading. I find that they help to quickly identify the trend and also act as dynamic support and resistance

As a side note, you might find that I don’t use them on all the charts posted on this site, but that’s only because I don’t want to unnecessarily clutter the price action patterns.

You are probably on to it by now, but I want to point out why that reversal pin at the top of the GBPCAD chart above doesn’t fit our criteria. So here it is…

pin bar against the trend

In other words, we didn’t have the necessary confluence to consider this a worthy pin bar to trade.

It has everything going against it except that it is a well-formed pin bar.

The two most important reasons why I wouldn’t trade the reversal pattern above are:

  1. It’s against the major trend
  2. There’s no resistance level to give me a reason to believe that it is indeed a reversal point in the market

That about wraps up confluence. Think of these confluence factors as your pre-trade checklist, similar to a pilot’s pre-flight checklist, only ours is a LOT shorter…at least I hope.

Pin Bar Entry and Exit Strategies

Because there are a few different ways to get in and out of pin bars, and because this lesson is already pretty long, I decided to include entry and exit strategies in a separate lesson.

Be sure to check out the link above to continue your pin bar education.

Frequently Asked Questions

What is a pin bar?

A pin bar is a type of candlestick pattern that suggests strong buying or selling pressure because of the long upper or lower wick, also called a shadow or tail.

What characteristics define a pin bar?

It must have a wick that is at least two-thirds of the candlestick’s range. So the body of the candlestick must be relatively small compared to the overall size of the pattern.

What makes these patterns effective?

The most effective pin bars occur at key support or resistance levels.

Are all pin bars reversal patterns?

Not necessarily. While most pin bars signal a reversal, they can also occur within a trend. So they can be continuation patterns under the right circumstances.

Is pin bar a good trading strategy?

It is, but only when combined with other factors, including the quality of the pin bar itself and whether it formed at a key level, among others.

Your Turn

Are you currently trading pin bars? If not, will you in the future after reading this article?

Let me know right now in the comments below.


Continue Learning

127  Comments

Leave a Reply

Your email address will not be published. Required fields are marked *

  1. Hi, I’m 18 and I just started trading forex and I love it. I find you articles and lessons vey helpfull! Thank you for the hard work.

  2. Hi Justin.
    One thing about the 3 types of Pin bar examples you provide confuses me.

    I understand the Pin bar reversal in a ranging market

    However, the example for the REVERSAL pin bar as part of a larger trend (Its the second picture after the title “3 types of pins bars”) appears to look like the pin bar CONTINUES the trend (Instead of reversing it like you mentioned).
    Could you please elaborate on what you meant here?

    Im also unsure about the pin bar as a continuation pattern with no (or very little) pullback, as the pin bar here does appear to pull back and reject the previous resistance.
    The picture i am looking at is the 4th picture from the title “3 types of pin bars”.

    Sorry for all the questions.
    Just found it quite ambiguous.

    If you could help clear that up, thatd be great.

    Kind regards,

    Jordan.

  3. Actually, never mind about the continuation pattern, i understand that now 🙂

    But i still am unsure about the “Reversal Pin bar as part of a larger trend” as your 2nd picture after the title “3 types of pin bars” appears to show the trend continuing instead of reversing.

    I hope these make sense!
    Please let me know if ive confused the crap out of you and ill try to explain differently.

    Thanks 🙂

    Jordan

    1. Jordan, I’m not entirely sure what you’re referring to, but I will be updating all of these older lessons over the next couple months. Hopefully that’ll clear up any confusion.

  4. heyyy sir! awesome articles… huge fan of yours already. though a little tough making decisions, but its really fun trading after i went through your words. God bless you. please email me if possible so i can contact you straight away.. thanks a million

    1. Al, pin bars are where I got my start with price action. And although I’ve incorporated other strategies since then, it’s by far one of the most telling candlestick formations out there.

  5. I must say,you are a very good teacher. I’m actually new to the trading world and have been trying and trying but my techniques wasn’t resulting in any productivity. I’m absolutely thrilled to start using pin bars and can’t wait to see what they will yield for me?
    I hope I will come back to testify !!

    1. Stephen, that’s great to hear, thanks for sharing. Be sure to browse the rest of the site as pin bars are just a fraction of what we trade.

      Let me know if you have any questions. Cheers.

  6. You are really excellent. I am Vietnamese. Maybe, I do not fully understand the meaning you want to convey. but I will try harder. thank you very much

  7. Great work.
    According to me the trick that is working now may not work in a year. So you have to be constantly learning new things to become a successful trader.

  8. I have just started using trend after reading your lesson, they are very interesting and have logic look forward to your emails

  9. Very lucid (simplified, non clutter) description of how to use pin bar in trading. Never saw such a beautiful piece in thirty years.

  10. Hi Jason, not directly relating to the above: I am a member and have been over your course and read many other DPA posts. I haven’t found any comment much less any clear recommendation for moving stops once a trade is under way. Can you please comment or direct me to a piece that might address this question.

    Regards,

    Charles.

  11. Hi Jason,

    I am thrilled with your lessons, I have been following and reading all. Though it is very hard to leave your old habits. I started trading using lower time frames M15 and I have the habit of going back to verify. After reading about the pin bars, I placed a trade on demo on GBPCHF on the 29th of August when the bullish pin bar was formed. Currently it has moved 725 pips. My question is, where do you place your take profit. Should I wait for a reversal pin bar to foam or it is guess work.

  12. Hi Justin, your lesson is great and so helpful. Though just new in the market, I think by your teachings, I have a great potential. Please, keep updating me. Thanks

  13. I’ve currently been practicing price action and now want to learn more about swing trading. This was a really helpful article and I’m reading a bunch more after this

  14. enjoying the posts/lessons… just lurking about and trading on crypto currencies in small amounts just to get some familiarity. Figured your advice here should be applicable over there. But what do I really know. Just saying hi and thank you.

  15. It’s now i begin to understand what is trading and how make good profit from it.
    Before it wasn’t interested in remaining in the business but now i begin to have interest in it.
    You begin to help me a lot,
    I lost a lot of money in forex
    I hope you’re help will continue until i get to the promised land.
    Thanks

  16. Hi Justin
    Thank you for your incredible knowledge. I am an amateur in forex trade. The lesson is really eye opener for me. I am looking forward to your next lesson on entry and exit pin point strategy. I am really struggling to identity the right place to enter and exit a position. I always realise, I enter late and exit late.

    My question is: at which point do I enter and exit a trade?

    Otherwise, I am gaining a lot because I am still going over the information to really understand better and trying to identify similar features on the live trade.

    Thumps up!!

    1. Olly, i am also having the same challenges as you.finding that point of entry & exit has proven to be more difficult for me too. thank you for contribution.

  17. hi beautifully explained pin bars, however I would like to know, should the touches to the support & resistance should be a pin bar touches or any other type of candle will be ok to make it a stronger support/resistance

  18. hi J, and everybody. i must say as a novice trader it becomes difficult to formulate, let alone stick to a strategy, which subsequently could, if not often, lead to the typical “few Big Losers and Multiple Small Winners” syndrome.
    However since i started reading your posts i’m gradually gaining confidence in the my trades since i now have a strategy in place thanks to you.
    Your price action and candlestick tutorials are what i’ve been looking for….

    Thank you and God bless…

  19. Hi Justin. I’m still a learner when it comes to trading but I find your tutorials quite informative. I have done some guesswork with binary trading before, but now I’m working on really understanding forex trading instead of thumbsucking. The reason that I started following your lessons is that I’m even battling with a demo account because it’s not growing, which tells me that, there must be something that I’m doing wrong.

  20. This content is such an amazing tool in my Forex toolkit. While trading Forex, at times I’ve inadvertently traded pin bars before but didn’t know it to be a strategy. Now I know why I do that and when not to do it. Thanks for all the great info you put out!

  21. Excellent, Very educating/informative…I have always gravitated towards D1 Time Frame in collaboration with Pin Bars…these lessons on Pin Bars has now reinforced and confirmed my choice…there is now no looking back

    Thanks Bro

  22. Good afternoon Justin, I have been trading with pin bars or at least I have been trying according to their explanations and they have been very productive, but I have had a problem in some occasions to identify if it is bearish or bullish since the color does not matter and this has been my difficulty, because when the trend is bullish and makes me a pin bar after a correction in some occasions this is black body and other white body and I confused this.
    But I wait with the practice and read and reread the explanation to overcome this confusion. See you and thank you.

  23. Hello, how long pin bar signal on D1 is valid for you? I mean how many D1 candles (or other candles) couses this signal is not still valid.

  24. Follow the people who make the money because they must have found a way to do that. If you want to find the gold you have to have a map to the Gold Mine. So buy the MAP

  25. I am not currently trading pin bars (didn’t know how). Thanks for making the 5-part course so simple to understand. I’ve now made the decision to demo-trade this strategy for a while then whenever I’m comfortable that I understand and can trade profitably, I’ll trade live.
    Once again, thank you. You are an excellent teacher. The videos helped tremendously.

  26. Really good stuff. I’m hooked.You explain these things well. I don’t usually comment on things like this.

  27. Amazing read. looked insane at first glance but made a lot easier after your explanation. Thanks Justin.

  28. I am just learning for the first time what pin bars are all about and considering what i have learned from this article, i intend to begin to trade use the pin bar strategy to trade. I’ll keep you posted

  29. I real get constructive information reading your articles thank you, but I need help on fibonnacci retracement use.

  30. Hi bro, I have not trade on pin bars but your clear analysis I am about to try my hands on it. I will give feedback later.

  31. Hello Justin, I have been studying your online coaching for a few days and found it interesting. My name is Obidi Okeke but you can call me Obi. I live in Lagos, Nigeria and a family man with a wife and 3 kids. I have practiced Forex trading with $100 following your online training guide and have made a profit of $80. I don’t want to presume I have perfected the art, but believe with you perfection is achievable. I would like to have a one-on-one with you. The reason been that I recently lost my job and will like to make Forex my main source of income. I have a savings of $5000 and will like to grow it to support my family in this hard times for us. I see an investment opportunity, with you by my side coaching me to be consistently profitable. My humble request will be if you can coaching me well to achieve this dream and I don’t mind paying a token in the early stages of this training.
    Help me to elevate my family to our dreams and aspiration. we will forever remain grateful.

    Humbly yours,
    Obi

  32. Hi Justin, i almost understand about your explaination only few that i didn’t get especially on the graph of Pin Bars and Confluence.. I am not sure how you draw the line because only few2 bars are peerfect Pin Bar and the rest are not.. I am just new in this forex.. Please explain more about it.. Thank you..

  33. I definitely will trade Pin bars. I learned a lot from this lesson. I think the explanation of using pin bars was so good and I think I finally understand the way pin bars are to be traded. Thank you for this lesson, I really didn’t understand how to trade it before. I probably should go over this lesson again to make sure I have it in my head clearly.

  34. The way you have explained Pin Bars here makes so much sense. I haven’t yet used them yet but I’m so much looking forward to use them in my trades. Hopefully, this might finally answer my ‘correct Entry-Exit point’ issue. Thank you so much for sharing such useful and knowledgable information!!

  35. Why does the pin bars look like they are hammers doji and shooting star they all have the same body style and they are use different terminology Is it because it depends on whos talking about the trade

  36. Thank you Justin for this material – it has helped clear off some clusters for me.
    I am still going through it to grasp everything you’ve taught very well.
    Nice job.

  37. Thanks for these publication. I intend to start trading pin bar. I noticed the EURAUD chart on the daily time frame, the moving averages have not crossed. How wise is it to trade trade base on that. Or one should ignore the MA in such instance.

  38. Hey sir I’m glad u read your lesson,want to buy lifetime membership but short at the movement from 2 weeks I’m studying ur lessons and learning much more thanks for helping.soon I’ll get membership.

  39. Does the color of the pin bar make any sense or is it just the size and the ratio of the body and tail? The bearish pin bar must be black and the bullish white?

  40. hi really you have taught me a lot s regards pin bars hadn’t seen it in that light before. I hope to trade them better now as I put to practise what am. Leaning
    Regards

  41. I am very thankful for your post. I just started trading forex and I am trying to learn from any and all the resources I can find in search of His Glory. I really hope you are still posting more helpful websites. Thank you for your teachings this beginner trader really needed it. Thanks again.

  42. I’ve tried to trade pin bars before, but never understood how important it is that they are rejecting a key support/resistance area.

  43. I really enjoy your explaination especially the video aspect. Thank you so much for the clarification and I will prefer to be on the safe side by seeing Pin bar as a continuation pattern rather than a reversal. Thank you for your knowledge sharing…… Mr Justin i must confess, i alway enjoy your Video more….

  44. Hello Justin, great article you have here, very helpful. But I have some issues with the analysis of the pin bars,

    Firstly, the analysis was done like you were looking at the market after everything had formed, not as if it was still forming. I believe if you put an analysis of the pin bars as if the market was still forming it will be more helpful. What I mean is the analysis is more of a post-trade analysis than pre-trade.

    Secondly, can this strategy work in ranging markets?

    Thank you Justin.
    You’ve been a great help!

  45. Hello Justin, great article you have here, very helpful. But I have some issues with the analysis of the pin bars,

    Firstly, the analysis was done like you were looking at the market after everything had formed, not as if it was still forming. I believe if you put an analysis of the pin bars as if the market was still forming it will be more helpful. What I mean is the analysis is more of a post-trade analysis than pre-trade.

    Secondly, can this strategy work in ranging markets?

    Thirdly, how do you confirm the pin bars even though it has rejected a level as some markets might still hang onto that level for a while before starting it’s move.

    Thank you Justin.
    You’ve been a great help!

  46. Mr Justin really helping and your notes are helpful indeed but I want to ask how do I use lot size and pip on my small account as a new trader to avoid using blowing my account in one trade… send my aswer via email or Whatsapp my number 0812847734

  47. Dear Justin, your article about pin bras was very interesting, due to I am a beginner, and as far as I know about price actions patterns and strategies would be better. As I became you fan and follower, am watching and reading as many material I can. My best regards.

  48. Currently I do not trade pin bars cos I have not fully understood it. Still new in the Forex market. Wish to start trading pin bar soon

  49. Thanks justin,but i still confuse trading with PINBAR,strong trend same like fast train,how we know just with one candlelistik,trend will reversal
    cause i just trading forex about 1 years,i still much learn(i like PRICE ACTION strategy)i already joint & follow your”socmed”.
    IG,Twitter,i read your web and its helpfull,….THANKS. GBU FROM INDONESIA

  50. wale,

    I have not been using the pin bar in my trading. Now that I have learned more about it from your articles, I will be using henceforth. Please help me with the article on PIN BAR ENTRY AND EXIT STRATEGIES. Thank you sir.

  51. Hello, I am a beginner trader. I haven’t tried the pin bar strategy, however, I’m keen to test it. It is simple strategy to understand. Thank you for sharing it.

  52. Hi Justin, I just started to learn forex and find your lessons very helpful !!! Thank you so much for your generosity in sharing this. Wish you and family all the best in health, happiness and prosperity.

  53. I am new to trading. No knowledge, but what I have learnt in this lesson will go a long way in helping me to start to trade.

  54. Hi, my name is Joshua okunade,
    Please sir, how can I use moving average 10 & 20 successfully combine with pin bar illustration.
    Thanks for being there for us.
    Regards
    Joshua.

  55. No I am not trading pin bars but will do so in the future.
    My FX future is depending on it, as my previous attempts at trading have all ended in confluence, together in the bin.

{"email":"Email address invalid","url":"Website address invalid","required":"Required field missing"}