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What is a Shark Pattern?
This pattern belongs to the Harmonic Pattern family, discovered by Scott Carney. It is a chart formation with extremely impulsive waves.
This Harmonic pattern requires a specific set of Fibonacci connections within its structure.
Furthermore, it has its own five-point labels, which slightly differ from the traditional harmonic labels. These are 0, X, A, B, and C instead of X, A, B, C, and D.
What is a Bullish Shark Pattern?
In the stock market, the word bullish characterizes rising prices. So, when you see a bullish shark pattern in your candlestick chart, it is an indication of rising market prices nearing.
There are many ways to trade a bullish shark harmonic pattern, but the most common way follows the traditional rule of thumb.
Which is to sell in sight of a bullish pattern and to buy in view of a bearish one. This is to avoid the nearing impacts of market price changes and benefit from them instead.
How To Identify a Bullish Shark Pattern?
The bullish harmonic shark pattern is usually characterized by two things.
The first would be that it appears to be shaped like the letter M due to its impulsive waves. And the second is that its second upward strike is higher than the first.
But there are also bullish shark pattern rules, which are a set of ranges your pattern should follow to confirm its accuracy.
It follows the 88.6% and the 113% reciprocal ratios. This means that point 0 and point C must fall within these numbers.
Example of a Bullish Shark Pattern
A deep shark pattern on your candlestick chart often follows a set of features.
The best example of a bullish shark pattern target is when it follows a well-retesting prior point as a counter-reaction, falling into the 0.886 to 1.13 range.
Another example would be the M-shaped formation, but this makes it easy for a shark pattern to be confused with something else.