An Order Block (OB) is the last opposing candle before an impulsive move — the zone where institutional money accumulated positions before pushing price. It is one of the most used entry concepts in Smart Money Concept. Here is what it is and how to trade it without confusing it with plain support.
What an Order Block is
In a bullish move, the bullish Order Block is the last bearish candle before the impulse that breaks structure. In a bearish move, it is the last bullish candle before the drop. The logic: institutions cannot buy all their volume at once without moving price, so they accumulate in that zone before firing the move. When price returns, they defend that zone.
Order Block vs support/resistance
Classic support is a level where price bounced before. An Order Block is more specific: it is the exact accumulation candle that precedes a break of structure (BOS). Not every support is an OB, and the structure context is what validates it.
How to identify a valid Order Block
- Locate a recent break of structure (BOS).
- Mark the last opposing candle before the impulse that caused the BOS.
- Check that the impulse left an imbalance (FVG) — it reinforces the OB's validity.
- The OB stays "live" while it has not been mitigated (price has not returned to it).
How to trade it
Wait for price to pull back into the Order Block in the direction of the bias. Look for confirmation inside the zone (rejection, minor ChoCH) and enter with a stop on the other side of the OB. Maximum confluence: OB + FVG + a prior liquidity sweep in the same zone.
Automate Order Blocks and structure
Our free structure and liquidity indicators on TradingView, or Master of Liquidity EA that trades OBs, FVGs and sweeps automatically on MT5.
Related: what is a Fair Value Gap · SMC indicators for MT5.
Educational content. Does not guarantee profitability. Trading involves risk of capital loss.