Not me…I saw this signal on the daily but didn’t fancy going for it because the range of the two bar reversal was a bit large and not enough RR before first resistance…
what signal did you use to enter this one Aaron?
Cheers,
(ignore the duplicate chart - don’t know how to get rid of it!)
I took the 2 bar reversal that you have posted. 1.4800 is an absolute solid support level and gave me good confidence in the setup. Normally wouldn’t taken it because of the 1:1 RR but the level was so clear cut I didn’t haven any reservations on taking it. RR aside, the PA candles themselves were great looking. They were quite a bit larger than the previous candles, which showed the strength of the bulls that they were able to almost completely recover the previous days huge loss. Also these candles were “down in” the support level I had marked which I knew would help put a good buffer between my entry and SL. If you zoom into the intra day candles you can see that price made a lower high, and then a higher lower which shows us price consolidating and winding up(pennant pattern). Price then broke out of that pattern to the upside, a win for the bulls. There were lots of places to enter here, break of the 2BR, retracement of the 2BR, break of the pennant pattern. All would have been ok to take, but the retracement would have given a solid 1:2 RR.
Removing duplicate pictures had me stumped for a long time also. The way to get rid of them is when you click “edit” on your post, on the next screen towards the middle/bottom of the page there is a button that says “manage attachments”, and you can then remove the duplicate.
Right now as a beginner I’m only trading pin bars, haven’t tackled 2 bars yet. But from looking at it, it looks like if you combine the 2 bars it’ll just about make a pin bar, is that correct logic? If so, is it traded the same as a pin bar as far as entries, stop losses and such?
Yes you can combine the 2 bars although I would suggest most people not to do that. Charts are price over time, and combining candles incorrectly can skew the actual price action picture. If you only combine the 2 bars but not the whole chart of candles then your skewing your chart because you are doubling up 2 periods of price data into 1 candle, but the rest of the candles on the chart are holding half of the price/time data compared to your combined candle. There are chart period convertors in MT4 that will let you combine the whole chart into bigger time frames like 2 day candlestick charts which is the right way to combine candles if you are going to do it. The other reason I don’t like combining them is because the pin bar has a set of rules that differ from 2BR, so the 2BR truly is its own unique signal. My suggestion for those just starting out is to trade each setup as they appear in the timeframe the setup occurred in.
Thanks Aaron, good to have you back on the thread 
Please could you post the pennant pattern you mentioned, not sure which you mean.
Thanks the education Krugman. Have you covered the rules of the 2BR yet? I checked the newbie thread and this one and wasn’t able to locate anything.
Hey Amy,
I think Aaron ment this pennant pattern which you can clearly see on the 4 hour chart or lower, which price broke out of to the upside as he mentioned. 
Cheers, diablo
Yes this one
Hi krugman25,
I saw in your post lot of time you mentioning things such as “Text book pin bar”, “Text book two bar reversal” , “Text book Pattern” etc.
Can you please let me know a good place to learn about text book definitions of Price action Candles and price action patterns you mentioned in the list titled [B]Things we DO use[/B]: in the first page of this thread.
I feel i should first learn the text book definitions of those.
Thank you !
Hey diablo, I hope this flag pays off as I’ve been in this at the 2br set a retracement and a break ( split lots equally) and if it weren’t for the fact of the BRN 1.4000 for support i would of just taking it in the chin and manually closed this trade.
All I can say is come on the bulls!!
Darth
Hey chanakam, great question here. When I use the term “text book” I am talking about a very high quality formation of a specific pattern or setup. Text book means the pattern clearly fits all of the requirements of that particular setup or pattern. Sometimes I will say to look for “clearly defined”, which is the same meaning as textbook. You will periodically get setups where traders will argue if a pinbar is valid or if a pair is trending or ranging. That’s usually comes from setups that are less than text book and are more subjective.
There can be a lot of different rules and definitions for the same setups and patterns since there isn’t a single authority that says what a characteristics a pattern should or shouldn’t have. The requirements I use for the patterns I trade are the ones I have found to be the least subjective and the most widely used in the trading community. I unfortunately don’t have all of those written down for reference, although I do cover some of the requirements for trading support and resistance areas in my articles. In this post I have added the rules for individual candle setups. These are rules that only involve the formation of the pattern and whether it has formed validly or not.
[B]Pin bar[/B]
*Real body must be no more than 1/3 of total candle size
*Real body must be in the top/bottom 1/3 of total body length
*Candle must close within previous candle OR proxy candle
*BONUS - Candlestick is as large or larger than previous candle/s
*BONUS - Candle closes within previous candle
*BONUS - Little to no wick on real body side of the candle
*BONUS - Real body closes as doji or strong in the pin bar formation
[B]Engulfing[/B]
*Full body(real body + wicks) of the engulfing candle must completely engulf the full body of the engulfed candle
*Engulfing candle real body must close within top or bottom 1/3 of the full length of the candle
*BONUS - Engulfing candle is as large or larger than previous candle/s
*BONUS - Little or no wick on engulfing/engulfed candle on the side of the candle that faces the direction to be traded
[B]Inside Bar[/B]
*Full body(real body + wicks) of the child candle must be completely inside the full body of the mother candle
*BONUS - Both child and mother are small compared to previous candle/s
*BONUS - Multiple child candles forming within mother candle(A.K.A. - Coiling Inside Bars)
*BONUS - Mother or child candle also form a pin bar shaped candle
[B]Morning/Evening Star[/B]
*2nd candle must not extend into more then 50% of the length of the 1st and 3rd candle
*2nd candle must close within either 1st or 3rd candle
*On the side of the candle for the direction of the trade, the real body of the 1st and 3rd candle must close within 1/3rd of the total length of the candle
BONUS - 2nd candle should form a doji or pin bar like shape
BONUS - 2nd candles wick opposite the 1st and 3rd candle is long
BONUS - On the side of the candles for the direction of the trade, the real body of the 1st and 3rd candle must close within 1/3rd of the total length of the candle
BONUS - 1st and 3rd candles are as large or larger than previous candle/s
[B]Two Bar[/B]
*2nd candle must close within 1/3 of the previous candle on the side of the candle that faces the direction of the trade
*BONUS - Engulfing candle is as large or larger than previous candle/s
*BONUS - Little or no wick on the side of the candles for the direction of the trade
For the full patterns I trade I use most of Thomas Bulkowski’s pattern rules - ThePatternSite.com
Remember these are all rules regarding the formation and validity of a pattern, this doesn’t include the many entry/stop loss/take profit rules that go with each individual pattern.
Thanks for the update Krugman.
The way you trade really opened my eyes in terms of RR. You gave me confident to try even higher RR trades such as touch trades in lower time frame. The result is amazing. You have my deepest gratitude
Just closed out my first trade of the year for 1.5% profit. It’s nice to start out the year this way. There was a potential retracement entry that would have offered 2:1, but I took the safer route and entered at the break. There was a minor resistance(not marked in the picture), that was just below the top of the 2 bar reversal. By entering at the break of the 2BR I was able to get in after price had already broken past that minor resistance. As expected price reached my TP area and has since stalled and retraced a bit. This was a great setup that I would give a solid 3 star rating, if not for the poor RR it could have easily gotten a 3.5 - 4 star from me.
Now what???
Looking at how the larger price picture is forming, we could have bearish movement in the near-mid term. Price has reached a solid resistance area and as of the writing of this post is forming a bearish pinbar on the daily. There is plenty of time for that to change, but if we do have a large pinbar form on the daily this could present a trade off of the daily. We also have a large rising wedge forming which has bearish connotations to it. If a pin bar does form today, it will have formed off of the upper trendline of the rising wedge which will bolster the possibility of that pattern playing out. I will certainly be watching the price action to see if we have a potential trade from the daily and bearish movement from within the rising wedge.
Thanks Amy, I am glad to be back! Things get crazy in the last couple weeks before the new year, I am glad things are normalizing again.
Hey Darth!
Unfortunately price has not been showing a lot of respect to the BRN 1.4000 lately. Looking on the weekly chart i would not be surprised if we get a retrace back to the solid S/R at 138.400’s which would be a normal break out and continuation as we usually see when price breaks an important S/R level.
And that level also has a spot on confluence with the 50% fib-level of the latest swing on the daily (50% of the flag pole). The little i know about flag patterns is that a 50% retracement of the flag pole before continuing in it’s path is pretty common.
But maybe the level is respected, we’ll see. As we all know the markets always tend to surprise us. 
Yesterday i jumped on a nice pin bar on the 8 hour chart of the EURNZD. It was at a really good looking s/r level.
Within 15 minutes price just collapsed and a few hours later my first target was hit. One of the fastest trades i have had lately. 
Did anyone else catch this one?
It was really a nice breakout, retrace and continuation trade where price slowly made it’s way up to the support which now had become resistance just to be strongly rejected. There were many long wicks indicating a rejection at that level which also was at the golden ratio (61.8% fib retracement) of the latest swing. I also really liked the size of the pin bar and the penetration of the level.
Looking on the daily this move produced a nice big bearish engulfing bar.
[QUOTE=“Diablo1505;591740”]Yesterday i jumped on a nice pin bar on the 8 hour chart of the EURNZD. It was at a really good looking s/r level.
Within 15 minutes price just collapsed and a few hours later my first target was hit. One of the fastest trades i have had lately. 
Did anyone else catch this one?
<img src=“301 Moved Permanently”/>
<img src=“301 Moved Permanently”/>
It was really a nice breakout, retrace and continuation trade where price slowly made it’s way up to the support which now had become resistance just to be strongly rejected. There were many long wicks indicating a rejection at that level which also was at the golden ratio (61.8% fib retracement) of the latest swing. I also really liked the size of the pin bar and the penetration of the level.
Looking on the daily this move produced a nice big bearish engulfing bar. :)[/QUOTE]
Hey Diablo
I got in on this one too, it was a very nice pinbar and a welcome return to profit! Which I took around the 100 pips mark.
I am really enjoying this Thread! Great Job!
Thanks for dropping a post here jwilldunk. I am glad to hear you are liking the thread. It is pretty rich in educational material and has only been running for 4-5 months. To be honest I have really only scratched the surface on a few various topics. If you don’t mind, tell us a little about yourself and your experience with trading/price action.
Welcome to the Price Action that Matters community!
