below the.618 level for an approximate profit of 174 pips. An up sloping trend line indicates an uptrend and the down sloping line is a down trend. Once familiarized with the pin bar formation, it is apparent from looking at any price chart just how profitable this pattern can. A general rule of thumb is that you want to see the pin bar tail be two/thirds the total pin bar length or more and the rest of the pin bar should be one/third the total pin bar length or less. When combined with a strong support or resistance level, pin bars can be one of the most accurate trading signals available. Reversal bars taken at confluent levels can act as a map to long-term profits in the forex market. Trend line breaks are a very common trading strategy and we are going to utilize the trend line break as a way of showing a change of character in the market. This allows me to not be glued to the trading charts or be at the beck and call of alerts being sent to my phone. The market needs to move up into your buy stop or down into your sell stop to trigger.
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The chart also shows structural resistance price targets other wise known as support and resistance. Examples of the Pin Bar Formation in Action Here is a daily chart of CAD/JPY, we can see numerous pin bar formations that were very well defined and worked out very nicely. In the following daily USD/JPY chart we can see an ideal pin bar formation that resulted in a serious move and trend reversal. This chart is showing where you would place your stop. The more confluence you can combine with a pin bar signal the higher its accuracy becomes.