Did you know? Trading and fishing are actually the same thing. Most of the time, I just sit there waiting for signals. Once a signal appears, it's time to make a move. For commodities like XAUUSD, a Pinbar is the clearest signal.

What is a Pinbar? It's very easy to recognize. Imagine a candlestick with a prominent long shadow, twice or even three times the length of the real body, while the body itself is very short and tightly attached to the end of the candle. That’s what a Pinbar looks like.

Why is this pattern so important? The market logic behind it is very clear. For example, a long lower shadow indicates that the bears tried to push the price down, but the bulls strongly pushed it back up. Conversely, a long upper shadow shows that the bulls launched a fierce attack but were strongly suppressed by the bears. The longer the shadow, the higher the probability of a reversal.

But here’s a key point: position is everything. A good fishing spot is needed to catch big fish, and similarly, a Pinbar must appear in a critical location to be valuable.

Where do high-probability signals usually occur? Bullish Pinbars near important support levels, indicating a buy signal. Bearish Pinbars near key resistance levels suggest a sell signal. You can also combine Bollinger Bands, moving averages, or Fibonacci retracement levels for confirmation.

In practice, when you see a bullish Pinbar and the signal is confirmed, you can enter the trade. That’s the most practical entry logic in trading.