Home General How to Use the Pin Bar like an Experienced Trader

How to Use the Pin Bar like an Experienced Trader

by Olufisayo
forex

The traders need to have a balanced trading strategy so that they can find a perfect buying or selling zone. But creating the strategy from scratch is not that easy. There few traders in Hong Kong who often buy the most expensive trading strategy on the internet with great hope to become a millionaire.

Soon they realize, nothing in the world of the investment business is perfect. Since the price movement of the asset greatly depends on the sentiment of the consumers, economic factors and other important variables, it’s really hard to predict the movement. However, a small percentage is still making some heavy cash by speculating market price.

Thousands of trading strategy is out there in this world. Among them, the price action trading strategy has gained huge popularity. Instead of discussing the details of the price action trading strategy, we give you some professional tops to trade the pin bar.

What is a pin bar?

The pin bar is a Japanese candlestick which indicators reversal signal. The body of the pin bar is very small and it has long wick or tail. In general, the wick is 3-4 times the length of the body.

The bigger the wick the better the signal. You may think how can we make a profit by using a single candlestick? You don’t have to use a super complicated trading strategy to create the perfect trading system. The use of a pin bar can make super rich and change your life.

       

Support and resistance level

To trade the pin bar, you have to learn about the basic details of support and resistance. Drawing a valid support zone requires an understanding of the key swings. You need a minimum of three connecting points to find a support or critical zone. But the horizontal line is not the only way to find the critical trading zone.

With the help trend line tools, you can also improve your accuracy in Forex trading. The trend line can give you strong support and resistance level to execute the orders. So, think about the potential buying zone and selling on the trend line as it will give you the unique opportunity to place the trade in favor of the trade.

Executing the trades

Once you have the skill to find the critical support and resistance level, you have to execute the trade. When you are dealing with an uptrend, you have look for the bullish trend line or critical support zone. Look for the bullish bar at the trading level. On the contrary, look for the bearish pin bar at the critical resistance zone.

The trade execution process is very easy when you use the pin bar trading strategy. But things become a little bit complex when you start to face major changes in trend. Most of the time the traders fail to control their emotions and start placing more trades. Being a pin bar user, you can’t afford to execute any new trade once you lose in a specific trading session. You need to take the day off and look for the signals in the next day.

Protecting the trading capital

Those who are using the pin bar trading strategy, know very well how easy it can generate profit. But trading the pin bar is doesn’t give you the immunity from the losing orders.

       

Everyone has to lose trades and those who have strong knowledge of risk management policy can protect their capital. Always use protective stops when you trade the bullish or bearish pin bar. The stop loss should be placed right above the bearish pin bar. In the case of a bullish pin bar, it should place the tail of the candlestick.

And always try to look for the quality signals in the daily time frame as it gives you more profit-taking opportunities. Most importantly you will have a high risk to reward ratio for the trades.

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