![insidebar1 » Learn how to trade the market inside bar 1](https://www.learntotradethemarket.com/wp-content/uploads/2019/03/insidebar1.png)
Today’s lesson is an introduction to inside bar signals and how to trade them. This is one of my favorite trading patterns, especially on the daily chart timeframe. why do you ask
It’s easy. Inner bar patterns indicate pause or indecision in the market and provide invaluable clues as to what the market might be doing next, depending on the surrounding price context formed within it. They will do it for you.
The Inside Bar is another ‘tool’ in your price action toolbox, an addition to your trading strategy that, when mastered, can help increase your chances of long-term trading success.
Let’s start with some introductory concepts and theory about the inside bar…
What is Inside Bar?
An inside bar pattern is a multi-bar pattern consisting of the first bar in the pattern, the “mother bar”, followed by an inside bar. An inner bar pattern can have multiple inner bars within the same mother bar.
A standard inner bar looks like this:
As you can see in the image below, the inside bar forms exactly in the middle of the mother bar or near the high or low price.To low distance of mother bar
![insidebarstructure » Learn how to trade the market Inside bar structure](https://www.learntotradethemarket.com/wp-content/uploads/2019/03/insidebarstructure.png)
4 variations of the standard inside bar
1. Double (Multi) Inside Bar
The “Double Inside Bar” consists of two inside bars within the structure of the mother bar. They are very common and often you will see 3, 4 or sometimes (rarely) more inner bars within the same mother bar structure. These patterns point to a prolonged period of indecision in the market and could come before a very strong breakout move…
![doubleinsidebarpattern » Learn how to trade the market double inside bar pattern](https://www.learntotradethemarket.com/wp-content/uploads/2019/03/doubleinsidebarpattern.png)
2. Coiling inside the bar
Inner bar pattern winding occurs when two or more inner bars are “coiled” tighter and tighter inside each other like a spring. Be especially careful when these appear. This means that the market is shrinking, and like a spring coiling tighter and tighter, it eventually “releases” and explodes into a powerful move (often).
![coilinginsidebarpattern » learn how to trade in the market Coiling inside bar pattern](https://www.learntotradethemarket.com/wp-content/uploads/2019/03/coilinginsidebarpattern.png)
3. Fakie Pattern (Inside Bar False Break)
Fake trading patterns are very important with regards to the inside bar as there is an inside bar pattern within the fake. As you can see below, the fake is actually a fake breakout from the inside bar pattern. It’s literally where the price breaks out of the inside bar pattern in one direction but quickly reverses, sucking out everyone who was wrong and charging back in the other direction. Clearly, these give us very intelligent clues as to the price’s next potential direction.
![fakeyinsidebarpattern » learn how to trade on the market fake inside bar pattern](https://www.learntotradethemarket.com/wp-content/uploads/2019/03/fakeyinsidebarpattern.png)
Four. Inside bar pin bar combo pattern
As you know, the pin bar is one of the best price patterns you can trade and if you get a pin bar that is also the inside bar, it will be the inside bar pin bar combo pattern.
Combining the pin bar with the inside bar gives you both a freeing “windup” and a pin bar with a tail/shadow that indicates the potential next direction of the market. The inside bar is therefore not just a pause in the market, but a pause with an additional confluence. It is behind it, resulting in a stronger price action signal.
![insidebarpinbarcombo » Learn how to trade the market inside bar pin bar combo](https://www.learntotradethemarket.com/wp-content/uploads/2019/03/insidebarpinbarcombo.png)
Trading the Inside Bar Pattern
As with most other patterns, there are basically two main ways in which you can focus on intra-bar trades. As a continuation signal or reversal pattern.
Currently, I prefer to trade them as continuation signals on trending markets on daily charts.However, the inside bar can be very strong at key support and resistance levels as an inversion. Let’s see some examples:
Inner trading of bars with continuous movement
The “classic” way of trading the inside bar pattern, and my favorite way to trade it, is within the trending market as a continuous movement.
Inside bars are much easier to take in as the odds are already favorable for trading in trending markets. Inside bars often lead to breakouts or continuations along existing trend directions. They can provide an excellent structure for building your trades into a pyramid to win big.
![insidebarstrend » Learn how to trade the market inside bar trend](https://www.learntotradethemarket.com/wp-content/uploads/2019/03/insidebarstrend.png)
Tips: Avoid trading inside bars on major levels until the level is cleared. Such inner bars often create false breaks at major levels.
Trading/reversing the inside bar as a “stall pattern”
In some cases, the inside bar can be traded as a reversal/stall pattern where the price “stalls” at a certain level and leads to a reversal in the opposite direction.
In the chart below you can see an example of a good inside bar reversal signal. Notice that the inside bar is formed at the important chart levels. This shows that the market is hesitant and “not sure” if it wants to go higher. You can see that a strong downtrend has occurred as the price has fallen above the inside bar’s mother bar low.
![insidebarreversalpattern » Learn how to trade the market inside bar reversal pattern](https://www.learntotradethemarket.com/wp-content/uploads/2019/03/insidebarreversalpattern.png)
Note that trading inside the bar as a reversal pattern should only be attempted after successfully mastering trading along the daily chart trend as a continuation/breakout play, as explained above. .
Special inside bar trading tips
Here are some tips and tricks when trading inside the bar. These are the things I have learned over the years to increase my chances of success when trading this pattern.
- Tighter inside bar patterns and coiled inside bar patterns often lead to explosive big breakout moves. This is due to the “stored energy” when the market “coils”, and that energy is usually released in the form of strong breakout moves…
![coilinginsidebarbreakout » Learn how to trade in the market coiling inside bar breakout](https://www.learntotradethemarket.com/wp-content/uploads/2019/03/coilinginsidebarbreakout.png)
- Patterns containing smaller inside bar patterns allow for tighter stop losses and larger risk rewards, These are ideal candidates.
- Watch out for patterns that have both a very large mother bar and a large inside bar. These are often difficult to trade due to many false signals, making risk management more difficult.
- Two of my favorite patterns are Fakie Signal and Inside Bar Pin Bar Combo.
- One bad thing about bars is that many of them form over all timeframes. However, with the right training and experience with charts, you can learn to differentiate.
Conclusion
This was a basic introduction to inside bar signals and how to trade them. This pattern will be explored in more detail in the Advanced Price Action Trading course. Here are some of the things you’ll learn when you join:
- More inside bar variations and how to trade them.
- More chart examples.
- Member trading discussion forum including inside bar discussion
- Daily members continue with daily and weekly market commentary, discussing possible bar trade setups to form.
- Member trading videos and article library with more in-depth inside bar trading training.
- Email coaching and support line.
- Continuous free updates
I hope you found today’s lesson useful and inspiring. The inside bar is truly one of the most interesting and powerful price action signals he has.
Leave a comment below with your thoughts on this lesson…
If you have any questions, please contact us here.
![Neil Fuller Professional Trading Course](https://www.learntotradethemarket.com/wp-content/uploads/2019/05/nial-fuller-price-action-trading-banner-v1.jpg)
![Preferred Broker 2020 v1](https://www.learntotradethemarket.com/wp-content/uploads/2019/05/nial-fuller-trading-platform-new-york-close-charts-v1.jpg)