The Pin Bar is a classic trap pattern. You can often find it as part of the other strategies discussed here.
It goes the distance to trap traders by poking up above a swing high or below a swing low. Also, its long tail confirms that a price trap is present.
The best pin bars are those that went beyond significant swing highs and swing lows.
This is because many traders enter or exit their trades at major swing highs and lows. These traders, if trapped, will fuel our blast to profits.
- The market was in a bullish trend.
- Deep pullbacks prompt strong reactions. Bearish traders looking for reversals get excited; bullish traders looking for a bargain entry pay attention too.
- Despite an initial bullish thrust, this Pin Bar was a sign of overhanging supply. It was a sign of trapped bullish traders.
- This bearish outside bar was another trap for the bulls. It rose above the previous candlestick before closing below it, reinforcing the bull trap.
For traders who missed the Pin Bar entry, the bearish outside bar offered an excellent second chance.
Tags:
Basic Price Action