Crypto Academy / Season 3 / Week 8 - Homework Post for professor @cryptokraze - Trading Sharkfin Pattern

Good day everyone. Thanks to @cryptokraze for such a wonderful lecture on Trading Sharkfin Pattern. I will be doing the homework from the lecture, so sit back and look for somewhere quite quiet and comfortable as you read through this amazing article I created just for you(😉). Let's get started!!!


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Question 1: What is your understanding of Sharkfin Patterns.

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The sharkfin pattern occurs when there's a strong trend movement of price towards a direction, be it upward or downward price movement, and then a sudden reversal in the trend movement. For instance, a strong upward price movement and boom!! a sudden strong downward price movement.

The sharkfin pattern forms a V shape, because of it's trend reversal and that's the reason for it's name. A shark fin is V shaped and this trend pattern is V shaped.

To fully comprehend, what I'm saying, let me show you an illustration below of an uptrend reversal Sharkfin pattern.


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Below is an illustration of a downtrend reversal Sharkfin pattern


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Question 2: Implement RSI indicator to spot sharkfin patterns.

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RSI indicator is known to detect trend reversal and implementing it to spot sharkfin patterns, is a trend confirmation strategy.

Let me show you how you can make use of the RSI indicator to detect/spot an uptrend reversal sharkfin pattern.


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Let me also show you how you can make use of the RSI indicator to spot a downtrend reversal sharkfin pattern.


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Question 3: Write the trade entry and exit criteria to trade sharkfin pattern.

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Buy Position


Entry Criteria

  • Wait for the V shaped Sharkfin pattern set up

  • Ensure your RSI line is starting to rise above 30, meaning, it must be below 30 initially.

  • As soon as the RSI line is above 30, place your buy entry position there.


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Exit Criteria

  • Place your Stop Loss position some pips below the tip of the V shape formed

  • You can make use of RR 1:1 or RR 1:2, to know where to place your Take Profit position. For me, I will be making use of RR 1:2 to place my Take Profit position.


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Sell Position


Entry Criteria

  • Wait for the invented V shaped Sharkfin pattern set up

  • Ensure your RSI line is starting to fall below 70, meaning it must be above RSI line 70 initially.

  • As soon as the RSI line is below 70, place your sell entry position there.


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Exit Criteria

  • Place your Stop Loss position some pips above the tip of the invented V shape formed.

  • You can make use of RR 1:1 or RR 1:2, to know where to place your Take Profit position. For me, I will be making use of RR 1:2 to place my Take Profit position.


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Question 4: Place at least 2 trades based on sharkfin pattern strategy

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Demo Trade 1 - AXS/USDT

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Demo Trade 2 - MATIC/USDT

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Conclusion


The Sharkfin trading pattern is quite reliable in detecting/spotting trend reversal, which is a very cool and simple way for traders to take profit from the market. Using RSI indicator to further confirm trend reversal, makes it even more reliable. I personally feel this strategy is best for scalp traders, as it quite relies on traders to make quick profit from quick trend reversals. This is a very good trading pattern.

Special thanks to you, @cryptokraze, for organizing this amazing class and giving this nice assignment, as it has helped me in understanding Trading Sharkfin Pattern.

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