Order blocks are powerful price action zones created by institutional traders (banks, hedge funds). Recognizing them helps retail traders understand where big money enters or exits the market.
What Is an Order Block in Forex?
An order block is the last bullish or bearish candle before a strong impulsive move. It represents institutional orders that caused a significant market shift.
How to Identify Order Blocks
Look for a large candle that breaks structure (like a new higher high or lower low).
The opposite candle before that move is your order block.
Mark it as a zone, not a line — price often revisits these areas for liquidity before continuing.
How to Trade with Order Blocks
Wait for price to return to the order block.
Look for confirmation (pin bar, engulfing candle) before entering.
Set stop loss slightly beyond the zone.
Pro Tip:
Combine order blocks with trend direction and support/resistance for high-probability setups.
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