There are several free and convenient best metatrader indicators available for a trader’s use on the MetaTrader trading platform to facilitate profitability. One of such is the Pin Bar Indicator MT4.
The Pin bar is a unique candlestick system that signals price action traders into potential reversals in the market. A pin bar indicator is an extended long tail that ‘sticks out’ from price action.
Description of the Pin Bar Indicator Mt4
Martin Pring developed the Pin bar indicator. He named it after the legendary Pinocchio. Since it lies about the market direction or tricks breakout traders into believing that price is moving towards a particular direction when in actual sense, it is reversing towards the opposite direction. The pin bar tries to entrap traders in the process, but traders who are knowledgeable enough can make huge profits when the price breaks back in the opposite direction.
Martin observed that these types of bars surface in strong trending moves. In the process, at first, they trigger a break of the highs or lows for the move before reversing into the range of the prior candle. Hence, trapping traders in an adverse situation in the process.
Types of Pin Bar Patterns
Two types of pin bar patterns could be formed on the pin bar indicator; the pattern of formation is essential.
The bullish pin bar forms close to the end of a correction in an uptrend or the downtrend. Its long lower wick can recognize the bullish pin bar. When the bullish pin bar forms at the lows in the trend, a price reversal activity is expected. A bin par indicator can be very powerfull if you check it together with a price action indicator mt4.
The graphical illustration below is an example of a bullish pin bar on a price chart.
Example of Bullish Pin Bar
The tail of the pin bar demonstrates the area of thee rejected price, signifying that price will keep moving in the opposite direction to the tail points.
In this manner, a bearish pin bar design is one that has a long upper tail, demonstrating dismissal of more significant expenses proposing that cost will fall in the near term. Then again, a bullish pin bar signal has a long lower tail, showing dismissal of lower price recommending that cost will ascend in the near term.
The bearish pin bar is framed at the topmost tip of a rally, or after the finish of an adjustment to the downtrend. The bearish pin bar is distinguished by long upper wicks and a bearish close. This example demonstrates that value ascends to another high yet is dismissed, prompting a bearish near to the end. The recognition of the bearish pin bar almost at a key-value level. For example, a resistance level could be characteristic that price activity could be inverse.
The following outline underneath shows the bearish pin bar model on a value diagram.
Example of Bearish Pin Bar
How Do You Trade with Pin Bars?
Some entry choices are available to traders when trading pin bars. Foremost and perhaps, and possibly the most prevalent, is to enter the pin bar trade “at market,” in which case you enter the trade at the ongoing market price.
However, you must be aware that if you intend to enter the market based on the pin bar pattern, it must be completely shut before you enter. Since if it has not shut, it is not yet a pin bar. An alternative entry choice for a pin bar trading signal is to enter on a 50% retrace of the pin bar;
It means waiting for the price to retrace to about midway of the pin bar’s range from high to low. Another approach a trader can adopt is to enter a trade as soon as a valid signal appears. And that by placing the stop pending order. If it is a bearish Pin Bar, the sell stop order should be placed a little below the low of the Pin Bar. In contrast, the buy stop order should be placed above the high of the Pin Bar for a bullish Pin Bar.
The illustration beneath is an excellent example of what the different pin bar entry options look like:
How to Trade the Indicator
Although trading with the pin bar appears quite easy to understand, there is however a snag; to use it will require traders to keep an eye on the markets of choice always. For instance, if you choose to trade the pin bar patterns on lower time frames, then you need to survey all the markets you are regularly trading.
That challenge can be overcome by adopting the pin bar pattern indicator. By using the indicator, it is automatically handled for you by the indicator while you simply wait for the alert to act accordingly. The automated Pin Bar Indicator MT4 detects pin bars on all timeframes and displays them on the chart. Pin bars are precious to find and trade likely reversals in the market.
You can download and install the pin bar indicator on your MT4 platform and then drag the indicator to the chart of you choose. The pin bar indicator is easy to apply; it does not require any form of configuration after installation.
After installation, it can plot the arrows on the pin bars on the price chart. An upward arrow denotes a bullish pin bar and while the downward pointing arrow signifies a bearish pin bar.
The next chart below shows how the pin bar indicator plots these arrows on the charts.
Pin bar pattern indicator MT4
As illustrated from the graph above, the Pin Bar Indicator MT4 charts the bullish with the bearish pin bars on the graph time frame you choose.
It is noteworthy to state that the indicator should not be adopted in isolation. As the ideal practice is to use the indicator within an existing system.
Closing Remarks On Pin Bar Indicator
Without a doubt, the pin bar is a particular candlestick pattern designed in the markets near key price levels. As the pattern continues to form frequently, it becomes noteworthy when it is formed almost near significant price level such as resistance level. Price reversal as a result of the pattern is an excellent avenue for making a considerable profit. As emphasized earlier on in this article, it is not recommended to trade pin bar indicator in isolation.
Preferably, you have to fabricate the market setup to comprehend what is happening genuinely. Hence, the pin bar design pointer for MT4 is extraordinary compared to other accessible markers that you can utilize liberated from cost. The advantages of utilizing the best pin bar indicator MT4 is that it can improve your current exchanging technique. Whether or not you are exchanging with the pattern or a counter pattern merchant. The pin bar example can be an essential instrument in your exchanging toolbox.
The indicator is accessible for download free of charge. And you can quickly introduce the same onto your graphs and exchange with your current framework. The pin bar pattern indicator deals with the period on which it is introduced. In this way, it can completely incorporate onto your current exchanging framework or technique. While you can check for more tools and indicators on our best forex indicator website. It will help you enhance your ability to trade.