Glossary · Technical analysis

Order block

A price zone, often the last opposite candle before a strong move, where traders believe large orders were placed. It is popular in smart-money concepts.

In practice

Before a strong rally on GBP/USD, the last bearish candle is marked as a bullish order block. Traders look to buy if price returns to that zone, with a stop below it.

Common mistake

Marking every candle before a move as an order block. Without context such as trend and liquidity, the zones are close to random.

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