# Pin bar at a key level: a strategy to learn and test | DT Academy > A long-wick rejection candle at support or resistance, traded on its break. [Strategy Library](https://www.thedtterminal.com/academy/strategies) Price action # Pin bar at a key level A pin bar has a small body and a long wick: price tried a direction and was pushed back. On its own it means little. At a level that matters (support, resistance, a flipped level or a round number) it can mark where the other side stepped in. Beginner Forex, gold, indices Any session H4, D1 [Use this strategy](https://www.thedtterminal.com/login?signup=true&from=academy&entry=strategy_use&redirect=%2Fjournal%2Facademy%2Fstrategies%2Fpin_bar_at_level) [Practice it](https://www.thedtterminal.com/login?signup=true&from=academy&entry=strategy_practice&redirect=%2Fjournal%2Facademy%2Fstrategies%2Fpin_bar_at_level) Example 01 ### Pin bar at a key level on a chart USDJPY · H4 Pin at support pullback, rejection Level: 150.21Entry: 150.48Stop: 149.93Target: 151.58 (2R)Sample candles, not market data The wick went through the old resistance, now support, and the body closed back above it. The stop sits beyond the wick, where the idea is wrong. ### The rules Setup Mark the levels you count as key before the candle forms A pin bar: a small body with a wick at least two thirds of the candle The pin bar forms at your level, its wick poking through and its body closing back on the right side Entry Either: enter at the pin bar close Or: wait and enter on a break beyond the pin bar in the direction it points Stop Beyond the end of the wick Target The next opposite level, or 2R to 3R Manage Set the stop and target before entry and leave them ### Common mistakes - Trading every pin bar. Location is the skill. A pin bar away from any level is noise. - Using low timeframes. Small timeframes print many pin bars that mean little. - Not deciding with or against the trend. Sources disagree on this; pick one and write it down. ### When it's off - Skip pin bars in the middle of a range or a choppy market - Call it off if price trades through the far end of the wick ### Words to know Pin bar A candle with a small body at one end and a long wick on the other, showing price was pushed one way and rejected. A hammer is the bullish version after a fall, a shooting star the bearish version after a rise, and it only counts once the candle has closed. Support and resistance Zones, not single prices, where buyers (support) or sellers (resistance) have shown up before. A level is broken when a candle closes beyond it, and a broken level is often watched from the other side. Round numbers Prices ending in zeros, such as 1.1000, 150.00 or 2000, that many traders watch, so orders gather there. Take-profit orders tend to sit at them and stop losses just beyond them. Inside bar A candle whose high and low both stay inside the previous candle's high and low (the mother bar). A body inside the previous body (a harami) is a different test. Confluence Several of your reasons lining up at one price. When you make it yours, I'll ask what the rules above leave open. Start with one of these: - What wick size counts as a pin bar for you? - Which levels count as key, and how do you mark them? - Do you trade pin bars with the trend, against it, or both? [Ask Edge in DT Terminal](https://www.thedtterminal.com/login?signup=true&from=academy&entry=strategy_question&redirect=%2Fjournal%2Facademy%2Fstrategies%2Fpin_bar_at_level) ## From DT Academy - [How to read candlesticks](https://www.thedtterminal.com/academy/how-to-read-candlesticks) - [Market structure](https://www.thedtterminal.com/academy/market-structure) ## What testing exists Studies of candlestick rules on large US stocks found them not profitable on their own. That is why this strategy depends on the level, not the candle. ## Before you trust a backtest - Many professional traders risk under 1% of their account on one trade idea, and the common guideline is 1 to 2%. - The more versions of a rule you try on the same data, the more likely a good backtest is luck. Decide your rules before you test. - Include spread and commission, and practice on dates you have not looked at, before you trust a result. ## Sources - [Pin bar candle (opens in a new tab)](https://fxopen.com/blog/en/what-is-a-pin-bar-candle-and-how-can-you-use-it-in-trading/), FXOpen - [Guide to the inside bar trading strategy (opens in a new tab)](https://capital.com/en-gb/learn/trading-strategies/inside-bar-trading-strategy), Capital.com - [Candlestick technical trading strategies: can they create value for investors? (Journal of Banking & Finance, 2006) (opens in a new tab)](https://econpapers.repec.org/RePEc:eee:jbfina:v:30:y:2006:i:8:p:2303-2323), Marshall, Young and Rose - [Controlling risk (opens in a new tab)](https://www.ig.com/en/ig-academy/money-management/controlling-risk), IG Academy - [Forex risk management (opens in a new tab)](https://www.cmcmarkets.com/en-gb/forex/forex-risk-management), CMC Markets - [Pseudo-mathematics and financial charlatanism (Notices of the AMS, 2014) (opens in a new tab)](https://scholarworks.wmich.edu/math_pubs/40/), Bailey, Borwein, López de Prado and Zhu - [What is backtesting? (opens in a new tab)](https://www.ig.com/uk/trading-strategies/what-is-backtesting-and-how-do-you-backtest-a-trading-strategy--220426), IG DT Academy is education, not financial advice. Nothing here is a recommendation to buy or sell any instrument. Trading carries a high risk of losing money, and past results, examples and backtests do not guarantee future results. [Risk disclosure](https://www.thedtterminal.com/risk-disclosure) --- Risk disclosure: Futures, forex and options trading contains substantial risk and is not for every investor. An investor could potentially lose all or more than the initial investment. Risk capital is money that can be lost without jeopardizing one's financial security or lifestyle. Only risk capital should be used for trading and only those with sufficient risk capital should consider trading. Past performance is not necessarily indicative of future results. [Read the full risk disclosure](https://www.thedtterminal.com/legal/risk-disclosure). This is the Markdown version of https://www.thedtterminal.com/academy/strategies/pin_bar_at_level. 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