If you are just starting to learn candlestick analysis, the pin bar is one of the simplest and most reliable patterns. It often indicates a trend reversal or pullback, especially at strong levels. We explain everything step by step 👇
🕯 What is a pin bar?
A pin bar is a candle that shows:
the market first went in one direction, but then sharply reversed back.
This means:
— someone (buyers or sellers) tried to push the price,
— but the market bounced back,
— and this may be a signal of a reversal or a strong reaction at the level.
🧠 What does a pin bar look like?
✔ Small body (price has hardly changed)
✔ Long tail (shadow) on one side
✔ Almost no shadow on the other side
✔ Closing — at the edge of the candle, closer to the end of the tail
🔽 Example:
— The price fell → sharply reversed upward → closed at the top of the candle = bullish pin bar
— The price rose → reversed downward → closed at the bottom = bearish pin bar
⚠️ When does the pin bar not work well?
If there is a large candle before the pin bar that seems to engulf it, this may be a signal that the reversal is not strong.
📌 This situation is called engulfing:
— The previous candle has a larger body
— Its maximum is higher / minimum is lower than the pin bar
— It closes inside or outside the pin bar
👉 This indicates that the previous movement is stronger than the reversal.
📉 Often after this, the market continues in the old direction — be careful.
🎯 How to trade a pin bar correctly?
✅ Wait for the pin bar candle to fully close
✅ Open a trade on the next candle, but not at market
✅ Place a limit order at the opening price of the pin bar
🔽 Example:
— The pin bar opened at $29,500 and closed at $30,000
→ We place a limit order at $29,500 and wait for a pullback
→ Stop-loss is set just below the tail (for example, $28,950)
→ Take-profit is 2–3 times more than the stop (or to the nearest level)
📘 Pin bar and MA30 (moving average):
— Pin bar above MA30 → look for long
— Below MA30 → look for short
— Do not enter against MA30 without a very strong level
💡 In simple words:
A pin bar is a reversal candle.
You enter at the opening price, catch the pullback, and go with the movement.
But if there was a large engulfing candle before the pin bar, be careful: the market may continue its movement instead of reversing.
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