Order Blocks

Order Blocks (OBs) are areas where institutional traders place large buy or sell orders. Price often revisits these zones before continuing the move.

Order Blocks often act as reaction zones where smart money reloads positions.

What Is An Order Block

An Order Block is usually the last opposite candle before an impulsive move.

• Bullish Order Block = last down candle before a strong upward move
• Bearish Order Block = last up candle before a strong downward move
• Strong displacement often follows
• Price frequently revisits the zone later

Valid Order Blocks often appear near liquidity and structure shifts.

How To Identify An Order Block

Strong Order Blocks usually show clear signs of institutional activity.

• Strong impulsive move away from the zone
• Displacement with momentum
• Break of Structure (BOS) afterward
• Imbalance or Fair Value Gap nearby

Price returning to the zone creates potential reaction opportunities.

Order Block Framework

Strong Order Blocks usually follow a clear sequence.

Basic OB Logic:

Order Block = last opposite candle before an impulsive move.

High Probability Framework:

Impulse + Displacement + BOS = Higher probability Order Block

• Impulse shows strong intent
• Displacement shows aggressive movement
• BOS confirms structure shifted

The more confirmation exists around an Order Block, the stronger the setup becomes.

How To Trade Order Blocks

• Wait for BOS or CHoCH confirmation
• Mark the Order Block zone
• Wait for retrace into the area
• Look for reaction or confirmation wick
• Combine with liquidity and imbalance

Order Blocks work best when structure, liquidity and confirmation align.

Quick Recap

• OB = institutional reaction zone
• Bullish OB = last down candle before expansion
• Bearish OB = last up candle before expansion
• BOS improves probability
• Confluence creates cleaner entries