The Pin Bar forex scalping strategy is a single candlestick price action reversal pattern that takes gives you information on levels where price has is tested and rejected.
Subsequently, the system is created to identify pin bars at support and resistance levels, so as to reveal bullish and bearish trends respectively.
Learn how to identify profitable trade setups with this strategy below.
Chart Setup
MetaTrader4 Indicators: PivotWeekly.ex4 (default setting), DynamicRS_C .ex4 (Input Variable modified; iPeriod=5: Color Width modified; #0=2, #1=2, #2=2)
Preferred Time Frame(s): 1-Minute, 5-Minute, 15-Minute
Recommended Trading Sessions: London, New York, Tokyo
Currency Pairs: Any pair
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Buy Trade Example
Fig. 1.0
Strategy
Long Entry Rules
Initiate a buy order if the following indicator or chart pattern gets displayed:
- If a bullish pin bar candlestick pattern forms around a support level (red line of the PivotWeekly custom indicator labelled 2 on Fig. 1.0), it is indicative of a market sentiment that is bullish, as such a buy entry is recommended.
- If an aqua filled line of the DynamicRS_C.ex4 custom indicator forms on the price chart as depicted on Fig. 1.0, it is signaling to upward price pressures, hence placing buy order(s) at this point is recommended.
Stop Loss for Buy Entry: Place stop loss 1 pip below immediate support.
Exit Strategy/Take Profit for Buy Entry
Exit or take profit if the following rules or conditions holds sway:
- Watch for bullish reversal price action formation (please refer to our reversal price action patterns on our website) around the resistance levels formed by the PivotWeekly custom indicator as a trigger for a possible exit or take profit.
- If during a bullish signal the aqua filled line of the DynamicRS_C.ex4 custom indicator turns yellow as seen on Fig. 1.0, it is a trigger to exit or take profit without delay.
Sell Entry Rules
Initiate a sell order if the following chart of indicator patterns takes precedence:
- If a bearish pin bar candlestick pattern forms around a resistance level (blue line of the PivotWeekly custom indicator labelled 2 on Fig. 1.1), it is indicative of a bearish market sentiment, as such a sell entry order is advised.
- If a red filled line of the DynamicRS_C.ex4 custom indicator forms on the price chart as depicted on Fig. 1.1, it is signaling to downward price pressures, hence placing a sell order is the right way to go.
Stop Loss for Sell Entry: Place stop loss 1 pip above immediate resistance.
Exit Strategy/Take Profit for Sell Entry
Exit or take profit if the following holds true:
- Watch for bearish reversal price action pattern (please refer to our reversal price action patterns on our website) around the support levels formed by the PivotWeekly custom indicator as a trigger for a possible exit or take profit.
- If during a bearish signal the red filled line of the DynamicRS_C.ex4 custom indicator turns yellow as seen on Fig. 1.1, it is a trigger to exit or take profit straight away.
Sell Trade Example
Fig. 1.1
Free Download
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About The Trading Indicators
Pin bars offer traders clues on price actions and as such they are individual candlestick pattern that are usually recognized by their small bodies and long wick.
The DynamicRS_C.ex4 on the other hand is a trend indicator that reveals price change.
When the line of indicator is painted red is denotes a bearish signal, while aqua depicts bullish market sentiment.
The yellow filled line reveals when trend is about changing, hence why we exit at such levels.
PivotWeekly.ex4 is a custom tool that plots weekly pivot (resistance and support) levels on the activity chart, thereby offering us clues on important Fibonacci retracement levels.