Shark Pattern
The shark pattern is a technical analysis charting pattern used to identify potential reversals in the price of a security. It is a three-candle pattern that consists of a long red candle, followed by a gap down, and then a long green candle that closes above the midpoint of the first red candle. The pattern is named after the shark-like shape it forms on a chart.
History of the Shark Pattern
The shark pattern was first identified by Japanese candlestick charting expert Steve Nison in his book, Japanese Candlestick Charting Techniques. Nison noted that the pattern was often seen in the Japanese stock market and was used by traders to identify potential reversals in the price of a security. Since then, the pattern has become popular among technical analysts and is used to identify potential reversals in the price of a security.
Comparison Table
| Pattern | Description |
|---|---|
| Shark Pattern | Long red candle, followed by a gap down, and then a long green candle that closes above the midpoint of the first red candle. |
| Bullish Engulfing Pattern | A small red candle followed by a large green candle that completely engulfs the red candle. |
| Bearish Engulfing Pattern | A small green candle followed by a large red candle that completely engulfs the green candle. |
Summary
The shark pattern is a technical analysis charting pattern used to identify potential reversals in the price of a security. It is a three-candle pattern that consists of a long red candle, followed by a gap down, and then a long green candle that closes above the midpoint of the first red candle. The pattern is named after the shark-like shape it forms on a chart. For more information about the shark pattern, traders can visit websites such as Investopedia, StockCharts, and TradingView.
See Also
- Bullish Engulfing Pattern
- Bearish Engulfing Pattern
- Doji Pattern
- Hammer Pattern
- Hanging Man Pattern
- Morning Star Pattern
- Evening Star Pattern
- Three White Soldiers Pattern
- Three Black Crows Pattern
- Abandoned Baby Pattern
