Pin bar pattern
Pin bar is a candle with a small body and a long spike or wick directed upwards or downwards depending on the direction of the market.
Meaning of pin bar on the chart
For those who follow the candlestick analysis, this pattern is a strong signal of a future trend reversal. If the wick of a pin bar points up the price is predicted to go down.
If the wick of a pin bar points down that price is predicted to go up.
Ideal pin bar
Traders consider an ideal reversed pin bar a candlestick with two comparable obligatory criteria:
- Pin bars open and close levels are placed next to one of the previous bars ends near either the top or the bottom.
- Pin bars open and close levels are placed within the previous bar known as the left eye.
In this case most traders consider this pin bar to be a powerful signal for purchase of the option.
At IQ Option Wiki you can read other articles on how to trade pin bars and how to combine pin bar with Bollinger Bands to find great trading opportunities.
We wish you successful trading with IQ option.