Pin bar Forex Reversal Strategy

The pin bar forex reversal strategy combines trend lines and pin bars in order to find great low risk to reward trade setups. It’s not uncommon to achieve risk to reward ratio’s 1:10.┬áThe strategy can be used on any timeframe and currency pair.

Trading Tools

1) Trend lines
2) Any Timeframe
3) Any currency pair

Download link:

Click here to download the Pin bar Forex Reversal Strategy

Forex Indicators:

Click here to download the Pin Bar indicator

Trading Rules To Sell (see example below)

1) Find a significant up trend then draw a trend line connecting the successive bottoms.
2) Each of the following conditions must be met in order to go short: A price break below the rising trend line + bearish pin bar appears on the chart. A bearish pin bar, coinciding with a trend-line break to the downside is an optimum shorting zone.
3) Open sell order at market on the close of the pin bar.
4) Place a protective stop 1 pip above the high of the pin bar.
5) Exit: Use trailing stops, or use bullish candlestick reversal patterns, or combine both to exit the trade.

Example: Pin bar Forex Reversal Strategy, EUR/USD 5 Min chart

pinbar-trendline-forex-strategy

Looking to the chart above, we could easily recognize the up trend in the euro/dollar. We drew a rising trend line connecting the successive bottoms. At the top of the range, a pin bar appeared + price broke through the trend line.

As a result, we entered a short position at the close of the pin bar with our stop 1 pip behind the high of the pin bar. The risk on the trade was only 11 pips + spread. Have a look at the chart below how the trade worked out using a trailing stop. At the time of writing, the euro/dollar moved over 200 pips in our favor.

Using trailing stops to exit the trade , EUR/USD 5 Min chart

pinbar-trendline-forex-strategy1

Ride the trend until it bends! Always trail your stop loss 2-3 pips above the most recent resistance level.

Trading Rules To Buy

1) Find an important down trend then draw a trend line connecting the successive tops.
2) Each of the following conditions must be met in order to go long: A price break above the down trend line + bullish pin bar appears on the chart. A bullish pin bar, coinciding with a trend-line break to the upside is an optimum buying zone.
3) Open buy order at market on the close of the pin bar.
4) Place a protective stop 1 pip below the low of the pin bar.
5) Exit: Use trailing stops, or use bullish candlestick reversal patterns, or combine both to exit the trade.

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