Shark Pattern — The 5-0 Harmonic for Reversal Hunters

Every harmonic pattern we've covered so far — Gartley, Bat, Butterfly, Crab — speaks the same language: XABCD, entry at point D. The Shark breaks that language. Scott Carney described it in 2011, a decade after the Bat, and gave it different notation: OXABC. The entry falls at point C — the last point of the structure — and the pattern itself is formally "unfinished": what would be the final CD wave in other patterns hasn't happened yet here, and it carries a separate name — the 5-0 setup, which the Shark is a warning sign for.

Why bother with a fifth pattern with strange notation? Because the Shark describes market behavior that classic M/W shapes don't catch: an expanding range. The middle of the pattern makes new extremes BEYOND the previous ones — a higher high and a lower low — which, at a glance, looks like a megaphone, or a string of false breakouts in both directions. Where others see chaos, a Shark trader sees a structure with a calculable turning point. You'll find the shared rules of the family in our harmonic patterns guide; here we take apart the youngest and strangest member of it.

Pattern Structure

Bullish Shark: an impulse up, an expanding consolidation, then a deep decline into the C zone, where you buy. Bearish — a mirror image. The OXABC notation maps onto waves OX, XA, AB and BC.

Three identifying features. First, no requirement for the first correction: XA doesn't have to hit any particular retracement — a rarity in the family, and the reason the Shark sometimes gets dismissed as "nothing in particular." Second, point B beyond X: the market makes a new extreme (113–161.8% of XA) that looks like continuation but is actually the middle of the pattern. In the bullish version you'll often see a double top right there — a visual tell from practice. Third, C in a double confluence: 88.6–113% retracement of the whole OX wave (some sources put the lower boundary at 88%) and, at the same time, a 161.8–224% extension of XA. Only overlapping both measurements gives you the entry zone.

A notational trap for dessert: some write-ups label the same waves differently (e.g., B measured relative to "XB"). Before comparing two sources, check how they name the waves — half of the internet arguments about the Shark are arguments about labels, not geometry.

How to Measure Point D

In the Shark you're not measuring point D, but point C — the procedure, though, mirrors the PRZ approach from other patterns: you wait for three waves (OX, XA, AB) to complete and build the zone from two independent measurements:

1. 88.6–113% retracement of OX — a Fibonacci grid from O to X. Note the second boundary: 113% means C can go BELOW point O (bullish variant) — the pattern allows a poke through the very start of the structure. That makes it functionally similar to a liquidity sweep: it collects stops under the last clear low and only then reverses.
2. 161.8–224% extension of XA — a measurement of wave BC relative to XA. The ranges are wide, so the trade is about their OVERLAP: a sensible zone is where both measurements coincide, further narrowed by an outer level (old support, a demand zone on a higher timeframe).

The precondition for the whole measurement is point B: if wave AB didn't go past X by at least 113% of XA, there's no expanding range — meaning no Shark, just ordinary consolidation. And if B ran further than 161.8% of XA, the structure gets too stretched and no longer fits the definition. B is to the Shark what the depth of point B is to classic XABCD patterns: a filter that selects the pattern before you start calculating the entry.

How to Trade It

Entry. In the C zone — only after a reaction. A Shark by nature tends to complete on a sweep (C below O in the bullish version means stops got collected), so the best trigger is a fast return of price above the broken O level with a clear rejection, or a structure shift on a lower timeframe. Remember that wave BC is the longest and most impulsive in the pattern — entering with a blind limit order during it is asking to get run over.

Stop loss. Behind the 113% retracement of OX, with a buffer for noise. The logic: the pattern allows a poke through O up to a maximum of 113% — go deeper and the Shark's definition ends, replaced by a plain continuation of the decline. As with the Butterfly and the Crab, you place the stop behind the outer ratio, not behind the last wick.

Targets. First and most important: 50% retracement of wave BC. That's not an arbitrary level — it's the point where, in Carney's work, the 5-0 pattern begins, the "next pattern" growing out of the Shark. In other words: the Shark is, by definition, traded to the halfway point of the last wave, not to a full reversal. Further targets for the remainder of the position: the area around point B, then the area around A. Given how violent moves in extension zones tend to be, taking partial profit and moving to breakeven quickly matter even more here than in calmer, retracement-type patterns.

Context. The Shark works best where an expanding range makes sense: the tail end of trends, areas around important higher-timeframe levels, moments of elevated volatility after data releases. In the middle of a clean, calm trend, expanding extremes are rare — if you "see" a Shark there, you're probably forcing the swings.

Common Mistakes

Confusing the Shark with the Cypher. A near-identical silhouette, different rules: the Cypher is an XABCD with entry at D on 78.6% of XC and a narrower extension in the middle (127.2–141.4%); the Shark is an OXABC with entry at C on 88.6–113% of OX and an extension of 113–161.8%. Mixing up the notation shifts entry and stop by whole zones.

Trading a "Shark" without B beyond X. If the middle of the pattern didn't make a new extreme, there's no expanding range — meaning no pattern. That's the zero condition.

Holding the position "for a full reversal." By definition, the Shark targets 50% of BC; the rest of the move belongs to the 5-0 pattern and follows its own rules. Greed on this setup has a calculable price.

Entering during wave BC. The longest, most emotional wave in the pattern regularly overshoots individual levels. It's the zone (the overlap of both measurements) plus a reaction — or nothing.

Believing numbers without a source. The honesty standard of this series applies here too: no large-scale statistics at the Bulkowski standard exist for the Shark. The site Quantified Strategies published a backtest of a strategy built on this pattern — we note that such a test exists, but we weren't able to verify its methodology or results at the source, so per our standard we don't quote figures from it; treat any "Shark results" you find online as unverified. The problem runs deeper, too: automatic detection of a pattern with a loose first correction and wide ranges is extremely sensitive to swing definition, so two "Shark" backtests may be testing two different phenomena. The only trustworthy statistic is your own, from a journal with fixed rules.

FAQ

What is the Shark pattern? A five-point harmonic structure by Scott Carney from 2011, notated OXABC. The middle of the pattern expands the range (B goes beyond X at 113–161.8% extension of XA), and entry falls at point C — at 88.6–113% retracement of OX and a 161.8–224% extension of XA. The Shark precedes the 5-0 pattern.

How does it differ from other harmonics? By entering at C instead of D, by having no ratio requirement for the first correction, and by an expanding middle section that makes it look more like a megaphone than a classic M or W. The bullish variant often completes on a sweep — a poke through point O of up to 113% — before reversing.

Where's the stop and what are the targets? Stop behind the 113% retracement of OX with a buffer; beyond that, the pattern loses validity. The first target is 50% retracement of wave BC (the start of the 5-0 pattern) — and that's the proper horizon for this trade; further levels for the rest of the position are the areas around B and A, with mandatory partial profit-taking along the way.

FAQ

Rafał — Krypto Bez Ściemy

Trader and founder of Strefa Tradingu. He’s been breaking crypto down on YouTube for years — no hype, no signals, with a focus on market structure and risk management.

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