Pin bar
Also called: Pin bar, Pinocchio bar, Rejection candle, Shooting star, Pin bar mumu
A candle with a small body and one very long wick; it shows price probed a level and was pushed back by the close.
4 min read · one puzzle on the page
What does a pin bar tell you?
A pin bar is a candle with a small body and, on one end, a wick several times longer than that body. The wick sticks out of the chart like a pin, which is where the name comes from. A rough rule: the long wick should be at least two thirds of the candle's full range, with the body and the other wick squeezed into the rest.
What it records is a rejected attempt. Price ran hard in one direction, tested the levels there, then got pushed back before the close. A pin bar with a long upper wick says buyers tried higher and sellers shoved price back down. A pin bar with a long lower wick is the reverse.
The hammer and the shooting star are really pin bars with special names. A hammer is a lower-wick pin bar at the bottom of a decline; a shooting star is an upper-wick pin bar at the top of a rally. The term pin bar describes the shape without the location, which is why the real question is always the same: where did the rejection happen?
How do you spot a pin bar on a chart?
Measure first. Say a candle opens at 1.0850, runs up to 1.0874, dips to 1.0846 and closes at 1.0848. The range is 28 pips, the upper wick 24, the body 2. The upper wick is nearly the whole candle: that's an upper-wick pin bar.
Then look at the location. Did the wick test a resistance, the top of a range or a previous high? A wick that pokes just above a prior high and closes back below it tells you the stops there were taken and price was pushed back. A pin bar that meets a level says far more than one that forms on its own in the middle of the chart.
Check the candles around it too. The pin bar's wick should clearly stick out beyond its neighbours. If the candles next to it carry wicks of the same size, there's no special rejection, just a choppy market.
For a trade, the stop goes a little beyond the tip of the wick. On an upper-wick pin bar, a close above the wick's high breaks the rejection idea. In the example the tip is 1.0874, so the stop sits near 1.0877; entering on the close at 1.0848 means 29 pips of risk, and that distance is your 1R.
Try it on a chart
This chart ends at the top edge of a range with a candle turning down on an upper wick; it may not match the textbook pin bar ratio exactly, but it asks the same question. Look at which level the wick tested, where the close landed, and where the stop would go.
Price has been going back and forth in the same range for a while; now it has climbed to the upper edge and the candle turned with an upper wick. What do you do?
No sign-up needed. Take a guess; when the chart opens, you'll see why.
The most common pin bar mistake
Calling every long wick a pin bar. Around news, in thin hours or in the middle of a choppy range, long wicks are ordinary. If no level is being defended, the wick is noise and points nowhere.
Ignoring the stop distance. A pin bar's strength is its long wick, but that same wick pushes the stop far away. Entering a 29-pip stop with the size you'd use for 10 pips triples your risk. If the distance is long, the position gets smaller; the stop doesn't move to the middle of the wick, because that isn't where the idea fails.
Trading a lone pin bar straight against the trend. Inside a strong rally, a single upper-wick candle is usually buyers catching their breath. A rejection candle that appears before the structure breaks describes a pause more often than a reversal.
When does a pin bar fail?
If the next candle closes beyond the wick's tip, the pin bar is void. A close above the high of an upper-wick pin bar means the rejected prices were accepted after all, and any idea built on that pin bar ends there.
When the higher timeframe trend is strong, a counter-trend pin bar on the small chart is usually the end of a pullback rather than the start of a reversal. With the daily chart still making higher highs, an upper-wick pin bar on the 5-minute may give you a short dip at most.
Look at the room ahead as well. If strong support sits just below an upper-wick pin bar, there isn't much space to fall. A 29-pip stop against a first obstacle 15 pips away is under 1R before the trade even starts.
Frequently asked questions
Is a pin bar the same as a hammer?
A hammer is one kind of pin bar. Pin bar is the general name for any candle with a small body and one long wick. When it forms at the bottom of a decline with a long lower wick it's called a hammer; at the top of a rally with a long upper wick it's called a shooting star. The shape is the same family, and the name and meaning change with where it sits on the chart.
Is a pin bar a buy or a sell signal?
It depends on the wick and the location. A lower-wick pin bar shows price was rejected below; an upper-wick pin bar shows it was rejected above. On its own it isn't a signal: it needs to form at a level such as support, resistance or a previous high or low. A pin bar in the middle of the chart usually says very little.
Where do you put the stop on a pin bar?
A little beyond the tip of the wick: above the high on an upper-wick pin bar, below the low on a lower-wick one. A close past that point means the rejection no longer holds. Because the wick is long, the distance is long too; the fix is a smaller position, not a tighter stop.
