There are many types of candles you will come across while trading on the Binomo platform. It is a good idea to get to know them as they can simplify your work. They create specific patterns that will help you to discover the best trade entry points.
Pin bar candles characteristic
The candles that are called pin bars are characterized by an extremely small body and a long shadow on one side. On the other end, there may be a short wick or no wick at all. The long shadow may point upwards or downwards and it depends on price fluctuations on the market.
How to read pin bars on Binomo
Pin bars develop at the top of an uptrend or at the bottom of a downtrend. Their appearance forecast a change in a trend’s direction.
During an uptrend, the pin bar on the top will have a long wick pointed up. It is called a bearish pin bar. The trend might soon reverse and move downwards.
During a downtrend, the long shadow of the pin bar is pointed down. This pin bar is known as a bullish one. A consequent uptrend is imminent.
A perfect pin bar
There is a kind of pin bar that is considered to be perfect in the traders’ world. To assume a pin bar is ideal there are two conditions that must be met.
- The opening and closing of a pin bar must be located near the bottom or the top of the previous bar.
- The opening and closing of a pin bar must be contained within the length of the previous candle that is sometimes called the left eye.
The appearance of an ideal candle is regarded as the perfect moment to open a transaction. It should be a sell position when you spot a bearish pin bar and a buy trade when you detect a bullish pin bar during a downtrend.
Conclusion
Candlestick patterns are very helpful in recognizing entry points for your trades. Pin bars are a special candle type that gives you information about a trend reversal. The signal produced by the ideal pin bar is incredibly powerful.
Remember, there is a demo account on the Binomo platform. There you can practice trading based on signals received from pin bars.
Share your experience with us in the comments section below.
Best of luck!