1# Pin Bar (Price action stratey) Trading System
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A Pin Bar is a candlestick pattern where the body of the candlestick is very small and has a very long wick. There are two types of Pin Bars a Bullish Pin Bar and a Bearish Pin Bar.
A Bullish Bar is represented by a small body at the top and a long wick below, this indicates that price was sold down by the bears and then immediately bought straight back up by the Bulls. In a perfect world the close is above the open for a bullish pattern and no wick at the top of the body. The opposite of this is true for a bearish pattern.
How to trade
Locate support and resistance levels on the forex chart
2# 2B pattern Trading System Reversal Trading Techniq
2B for the first time pattern (excellent and very strong reversal trading technique) has been described in the book of Victor Sperandeo. pattern 2B apply as soon as the market price creates a new maximum or minimum, and then significant pullback. Following the implementation of the rollback, the price is once again trying to test generated a maximum or minimum price. Once this testing of “new” maximum or minimum is unsuccessful, it is a signal of potential reversal previous price trend.
In an uptrend, if prices penetrate the previous high but fail to carry through and immediately drop below the previous high, the trend is apt to reverse. The converse is true for downtrends."
[Vic Sperandeo in "Trader Vic: Methods of a Wall Street Master"]
Another name for the 2B is "spring." Imagine the blue line in the graphic as a rubber band. The bigger the poke above the blue line, the stronger the reversal potential if the breakout fails. This same principle works on failed triangle breakouts and failed trendline breakouts. If you were unfortunate and bought the breakout, instead of putting just a stop loss at the X, consider making it a stop-and-reverse. This pattern occurs at the tops and bottoms of consolidations as well as at major reversals.
When market makes new high or new low, there is always a pullback .After the pullback the market will retest the previous high/low. If the market fails to hold the new high/low, it signals a potential trend reversal. Trades orders are entered to sell the low of the bar trying to breakout or buy the high of the bar trying to breakdown. Target: The target is usually the ‘swing low’ prior to the new high or ‘swing high’ prior to the new low. Stop: Protect your ‘long’ trade entry by placing a ‘stop’ below the recent low and protect the ‘short’ trade entry by placing a ‘stop’ above the recent high.
*********************************************************************************************
THE CHART SETUP:
1)5 min candle chart - EUR$, GBP$, JPY$ & EURJPY pairs.
2)Put a 10 & 21 EMA & 50 SMA and ADX (14) on each chart.
3)SMA angle & 21 EMA based on first indicator data on this indicator.
Example chart:
THE TRADE CRITERIA:
1 Wait for the 50SMA angle to be more that 20 degree (subjective – no accurate
measurement)
2 Wait for 21EMA on SMA angle indicator to cross the 0.1 or -0.1/0.15 or -0.15 line.
2.1 The area between the 0.1 and -0.1 lines is called the no-trade zone.
2.2 No trades to be taken if 21MA is in the no-trade zone.
3 Wait for price to pull back through 10EMA to 21EMA (area between 10MA & 21MA is called the fire or war zone)
4 Optional – SMA angle bars to be higher or lower than 0.2 or -0.2 line
Example of chart:
THE TRADE SET-UP:
3.1 Draw a small trend line from the:
3.1.1 Last High or Low before the cross of the 51MA
3.1.2 Next high/s or low/s to form a small trend line
3.2 Ensure that the price and candles stay within the small trend line
3.2.1 Any break-out cancels the set-up/possible trades
3.3 Specific manner of pullback of candles towards war zone:
3.3.1 Smooth and flat pullback of candles – no steep pullback or big candles
3.3.2 Smooth rounding of top/bottom (wave-like pullbacks) – no sharp V shape change of direction
3.3.3 Ascending of descending triangle being formed between resistance/support level and
small trend line drawn
3.4 Identify the first candle to enter the war zone towards 21MA
3.4 Wait for second/more candle to pull back from 21MA towards 10MA
3.5 Enter the trade on the pullback a few pips away from the 21MA
4. THE TRADE:
4.1 Use a market order to enter within the war zone as specify
4.2 Put Stop Loss 6+spread pips away
4.3 Move stop loss to breakeven after a clean 6 pips gain/profit (brokerage/spread included
4.4 No Trailing Stop Loss
4.5 Put/activate profit limit on 10-15 pips
4.6 There are plenty of chances to get in a trade:
4.6.1 Don’t try to trade every signal that might work
4.6.2 Wait for the good setup to occur
4.6.3 Wait for the High probability ones
4.6.4 Rather miss an opportunity than to get involve in a bad/wrong set-up
A Pin Bar is a candlestick pattern where the body of the candlestick is very small and has a very long wick. There are two types of Pin Bars a Bullish Pin Bar and a Bearish Pin Bar.
A Bullish Bar is represented by a small body at the top and a long wick below, this indicates that price was sold down by the bears and then immediately bought straight back up by the Bulls. In a perfect world the close is above the open for a bullish pattern and no wick at the top of the body. The opposite of this is true for a bearish pattern.
How to trade
Locate support and resistance levels on the forex chart
-
Look for pin bars at resistance highs
and support lows
-
Go long at support levels after a pin bar has
formed
-
Go short at resistance levels after a pin bar has
formed
-
Enter a trade at the halfway point of the pin
bar
-
Place stop loss above the pin bar
-
Risk to reward: 3 to 1
2B for the first time pattern (excellent and very strong reversal trading technique) has been described in the book of Victor Sperandeo. pattern 2B apply as soon as the market price creates a new maximum or minimum, and then significant pullback. Following the implementation of the rollback, the price is once again trying to test generated a maximum or minimum price. Once this testing of “new” maximum or minimum is unsuccessful, it is a signal of potential reversal previous price trend.
In an uptrend, if prices penetrate the previous high but fail to carry through and immediately drop below the previous high, the trend is apt to reverse. The converse is true for downtrends."
[Vic Sperandeo in "Trader Vic: Methods of a Wall Street Master"]
Another name for the 2B is "spring." Imagine the blue line in the graphic as a rubber band. The bigger the poke above the blue line, the stronger the reversal potential if the breakout fails. This same principle works on failed triangle breakouts and failed trendline breakouts. If you were unfortunate and bought the breakout, instead of putting just a stop loss at the X, consider making it a stop-and-reverse. This pattern occurs at the tops and bottoms of consolidations as well as at major reversals.
When market makes new high or new low, there is always a pullback .After the pullback the market will retest the previous high/low. If the market fails to hold the new high/low, it signals a potential trend reversal. Trades orders are entered to sell the low of the bar trying to breakout or buy the high of the bar trying to breakdown. Target: The target is usually the ‘swing low’ prior to the new high or ‘swing high’ prior to the new low. Stop: Protect your ‘long’ trade entry by placing a ‘stop’ below the recent low and protect the ‘short’ trade entry by placing a ‘stop’ above the recent high.
*********************************************************************************************
THE CHART SETUP:
1)5 min candle chart - EUR$, GBP$, JPY$ & EURJPY pairs.
2)Put a 10 & 21 EMA & 50 SMA and ADX (14) on each chart.
3)SMA angle & 21 EMA based on first indicator data on this indicator.
Example chart:
1 Wait for the 50SMA angle to be more that 20 degree (subjective – no accurate
measurement)
2 Wait for 21EMA on SMA angle indicator to cross the 0.1 or -0.1/0.15 or -0.15 line.
2.1 The area between the 0.1 and -0.1 lines is called the no-trade zone.
2.2 No trades to be taken if 21MA is in the no-trade zone.
3 Wait for price to pull back through 10EMA to 21EMA (area between 10MA & 21MA is called the fire or war zone)
4 Optional – SMA angle bars to be higher or lower than 0.2 or -0.2 line
Example of chart:
THE TRADE SET-UP:
3.1 Draw a small trend line from the:
3.1.1 Last High or Low before the cross of the 51MA
3.1.2 Next high/s or low/s to form a small trend line
3.2 Ensure that the price and candles stay within the small trend line
3.2.1 Any break-out cancels the set-up/possible trades
3.3 Specific manner of pullback of candles towards war zone:
3.3.1 Smooth and flat pullback of candles – no steep pullback or big candles
3.3.2 Smooth rounding of top/bottom (wave-like pullbacks) – no sharp V shape change of direction
3.3.3 Ascending of descending triangle being formed between resistance/support level and
small trend line drawn
3.4 Identify the first candle to enter the war zone towards 21MA
3.4 Wait for second/more candle to pull back from 21MA towards 10MA
3.5 Enter the trade on the pullback a few pips away from the 21MA
4. THE TRADE:
4.1 Use a market order to enter within the war zone as specify
4.2 Put Stop Loss 6+spread pips away
4.3 Move stop loss to breakeven after a clean 6 pips gain/profit (brokerage/spread included
4.4 No Trailing Stop Loss
4.5 Put/activate profit limit on 10-15 pips
4.6 There are plenty of chances to get in a trade:
4.6.1 Don’t try to trade every signal that might work
4.6.2 Wait for the good setup to occur
4.6.3 Wait for the High probability ones
4.6.4 Rather miss an opportunity than to get involve in a bad/wrong set-up
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