The Pinbar Candle - REJECTION vs REACHING:

This is not a price-action course. This is not a course

designed to teach you about all the candlesticks and
candlestick patterns, but there is one candlestick that must
be discussed and it is the pinbar candlestick. It is
this WICK of the pinbar candlestick that is the cause of a lot
of stress for traders these days.

THE WICKS WE WILL BE FOCUSING ON.

Rejection: Price DOES NOT WANT to go in that wick
direction because it is likely being rejected.
Reaching : Price WANTS to go in that wick direction
because it is likely trying to reach further.
A PINBAR CANDLESTICK HAS PRINTED; LET US ANALYZE IT AND DETERMINE IF THE WICK
IS REACHING OR REJECTING.
Our focus with this candle is on the wicks, because every
trader is taught to immediately assume that the wicks
are REJECTING price, and the price DOES NOT want to go
in that direction.
In this example, we have a pinbar candlestick that has
printed. Our job is to validate this pinbar candlestick in order
to determine whether this wick is rejecting lower or is the
wick reaching lower, without immediately assuming that it
is automatically rejecting. 

STUDY THE CONTEXT OF THE PINBAR AND ASK THE TWO KEY QUESTIONS.
1. The first question is concerning the previous
highs/lows. In the case of a pinbar wick to the
downside, we will look at the lows of the previous
candlesticks.
 2. In the case of a pinbar wick to the upside, we will look
at the highs of the previous candlesticks; we must see
whether or not previous highs/lows were broken.

2. The second question is concerning the location of where

exactly the pinbar candlestick was printed; was it printed at
an edge of the price-action, or was it printed somewhere in
the middle of price-action. Ignore pinbars in the middle and
respect pinbars that print at the edges. Pinbars at the edges
are likely rejecting, and pinbars in the middle are likely
reaching and may get filled.
 THE PINBAR HAS BROKEN MANY PREVIOUS LOWS AND ITS RIGHT IN THE MIDDLE OF
PRICE-ACTION; IT IS LIKELY REACHING.
In this example, after studying the context of this pinbar, we
have determined that it is likely REACHING, and not
rejecting. In cases where the pinbar is reaching, WICKS
GET FILLED . Wicks that are reaching tend to become
candle bodies, as in the example below.
THE WICK OF THE PINBAR IS REACHING LOWER AND LIKELY NOT REJECTING LOWER.
 A CLASSIC PINBAR CANDLESTICK THAT IS REJECTING.
This is a good example of a classic rejecting pinbar
candlestick printed at an edge; these are the rejecting
pinbars that deserve our respect. 

Remember to validate your pinbar candlesticks and you will

immediately become more accurate and you will not
experience any surprises as you operate and trade the
financial markets. In the next section, we will begin
discussing timeframes and we will learn how to use them
efficiently in order to trade properly.