Shark Pattern vs Crab Pattern
The Shark pattern was identified in 2011 by Scott Carney. It resembles the Crab pattern to some degree. The main factor that sets the Shark pattern apart from other patterns is that it relies on the 88.6% level as a strong reaction in the opposite direction. You may also want to read about Crab Pattern.
It helps to review the other harmonic patterns, which give you a better understanding of how to trade the Shark pattern. This pattern was formed by combining the Fibonacci sequence with Elliott Wave theory.
Note that all the patterns covered earlier (Gartley, Bat, Crab, Butterfly) are marked by the points X, A, B, C, D. The Shark pattern is likewise marked by X, A, B, C, with point 0 marking the start of the pattern’s structure. In the Shark pattern, point B moves beyond point X.
Bullish Shark Pattern
- There is no specific retracement for A.
- Point B retraces 113% to 161.8% of XA.
- Point C completes the pattern at 88.6% to 113% of 0X and at 161.8% to 224% of AB.
Bearish Shark Pattern
- There is no specific location for A.
- Point B retraces 113% to 161.8% of XA.
- Point C completes the pattern at 88.6% to 113% of 0X and at 161.8% to 224% of AB.
Trading the Shark Pattern
Confirm zone C in the pattern with a clear reversal from that area, and place your stop loss according to your risk management.
Shark Pattern Targets
In the Shark pattern, take profit can be placed at 38.2%, 50%, 61.8%, 88.6%, or 100% of the C retracement.
Harmonic trading with the Shark pattern is a rule-based, mathematical approach, but it takes patience, practice, and a lot of study to apply it well. The basic measurements are only the starting point, because price moves that do not match the correct Shark pattern measurements invalidate the pattern and can lead to a loss.
The Shark pattern is one of the more widely watched harmonic patterns. Entries are taken from the potential reversal zone when price action confirms a possible reversal, and stops are placed outside the reversal zone defined for the Shark pattern.
Frequently Asked Questions
How many harmonic patterns are there?
The main harmonic patterns are 5 patterns built from points (Gartley, Butterfly, Crab, Bat, Shark, and Cypher). These patterns contain formations of 3 points (ABC) or 4 points (ABCD). All the price swings between these points are related and have harmonic ratios based on Fibonacci.
What is the Butterfly pattern?
The Butterfly pattern is a reversal pattern that forms near price lows and highs. Traders use the Butterfly pattern to signal the end of the current trend and an entry point during a correction or the start of a new trend. There are two types of Butterfly patterns: bullish and bearish.
What is a harmonic pattern?
Harmonic patterns are chart patterns that form part of a trading strategy, and they can help traders identify price trends by estimating possible future market moves. They form geometric price patterns using Fibonacci numbers to mark potential price changes or trend reversals.
What is classical technical analysis?
Technical analysis is a way of identifying trading opportunities based on reading price charts. Technical traders use these charts to determine the future direction of the market, as well as potential entry and exit points for each position.
What are harmonic patterns in analysis?
Harmonic price patterns take geometric price patterns to the next level by using Fibonacci numbers to mark potential turning points. Unlike other more common trading methods, harmonic trading tries to anticipate future moves.
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