What is an order block?
In smart money concepts, an order block is the last down candle before a strong move up (bullish) or the last up candle before a strong move down (bearish). Traders watch it as an area where price may react on a return.
How to spot it
- 1Find a strong, impulsive move that breaks structure.
- 2Step back to the last candle in the opposite direction before it.
- 3Mark that candle's range as the order block.
- 4Blocks that caused a break of structure are generally treated as more significant.
Common mistakes
- ✕Marking blocks with no impulsive move after them.
- ✕Treating old, heavily retested blocks as fresh.
- ✕Using blocks without considering the higher-timeframe trend.
The ICT lens identifies order blocks left by displacement; the Supply & Demand lens reads similar areas as zones.
Educational content only. Not financial advice. No pattern or concept guarantees any outcome.
Keep learning
A fair value gap is a three-candle pattern where a strong middle candle moves so fast that the wicks of the candles on either side don't overlap.
A liquidity sweep happens when price pushes just beyond an obvious swing high or low, where many stop orders sit, and then quickly reverses back inside.
Market structure is the sequence of swing highs and lows.
Support is an area where buying has stepped in before, slowing or reversing declines.
A demand zone is a base that price left sharply upward; a supply zone is a base price left sharply downward.
A breakout and retest is a three-step sequence: price breaks through a well-defined level, comes back to test it from the other side, and holds.
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