ADVANCED ORDER BLOCK CONCEPT
1. What is an Order Block?
An Order Block is a price zone where institutions or big players (smart money) placed large buy/sell
orders, typically before a significant market move. These zones are usually the last bullish or bearish
candle before a sharp impulsive move, reversal, or break of structure (BOS).
2. Why OBs Work
- Represent institutional footprints
- Act as supply/demand zones
- Often coincide with liquidity zones, FVGs, and breakers
- Offer low-risk entries and high reward opportunities
3. Types of Order Blocks
Type | Description | Context
----------------|----------------------------------------------|-------------------------------
Bullish OB | Last bearish candle before a bullish move | Buying zone
Bearish OB | Last bullish candle before a bearish move | Selling zone
Breaker OB | OB that fails and becomes support/resistance | Trap/Manipulation Recovery
Mitigation OB | Retest of OB after inducement | Order filling
Continuation OB | OB within trend | Trending markets
Reversal OB | OB at extremes with strong reversal | High-Risk-Reward setups
Quasimodo OB | Near quasimodo pattern | Entry after liquidity sweep
4. Structure Context (When OBs Matter Most)
Only trade OBs after:
- Break of Structure (BOS)
- Change of Character (CHoCH)
- Liquidity Sweep / Inducement
- Fair Value Gap (FVG) behind OB
5. High vs Low Quality OBs
Criteria | High Quality OB | Low Quality OB
------------------------|----------------------------------------|----------------------------
Market Context | With BOS, CHoCH, Liquidity | Random or mid-range
Candle Characteristics | Small body, long wick | Large candle body
Fair Value Gap (FVG) | Present behind OB | None
Reaction | Sharp impulsive move | Weak follow-through
Mitigation | Taps OB once | Tapped multiple times
Timeframe | 1H-Daily/4H OBs | LTF OBs often broken
6. Entry Techniques Using OBs
A. Aggressive Entry
- Place order at OB zone with SL below/above wick
- Confirm with FVG or breaker
B. Refined Entry
- Wait for LTF CHoCH inside the OB zone
- Enter on internal BOS
7. Timeframe Alignment
TF | Use
-----------|----------------------------
Daily/4H | Higher-timeframe OBs (bias)
1H-15M | Spot OBs, FVG, CHoCH
5M-1M | Refined entries
8. Confluences to Increase Accuracy
- FVG inside OB
- Liquidity sweep before OB forms
- Break of structure after OB
- RSI/SMT Divergence
- Volume spike at OB
- Previous unmitigated OBs
- OB at session open (London/NY)
9. Order Block Entry Model
1. Identify OB (Bullish or Bearish)
2. Ensure BOS/CHoCH structure
3. Wait for inducement/sweep
4. Confirm with FVG, internal CHoCH
5. Enter on LTF OB/FVG
6. SL below/above wick
7. TP: internal liquidity, next OB, equal highs/lows
10. Institutional OB Behavior
Behavior | Description
------------------|-----------------------------------------
Sweep + Return | OB forms after fakeout above liquidity
Front-run OB | Price reverses before touching OB
Deep Tap | Wicks deep into OB, then reverses hard
OB Stacking | HTF + LTF OBs aligned together
OB Shift | Original OB fails, new OB forms (breaker)
