Using this technique with also fibonacci levels give better signals. Simply find two swings previous to the one you are looking to trade, plot the fibonacci for both swings, and see if the pinbar is in a confluence of one level of each one of the fibonacci retracements. That will create a good support/resistance level to validate the pinbar.
Lots of different strategies to trading a pinbar. Some guys play the break of the high/low, others wait for further action and some even wait for a retrace into the pinbar (50% of the range). Different strokes for different folks. Would be interesting to see statistics on the different entry methods though. Any programmers in the house?