Order Blocks

An Order Block (OB) is the last opposite-color candle before a strong, displacing move — the footprint of where institutions likely placed orders before driving price away.

• A bullish OB is the last down candle before a sharp move up. When price returns to it, that zone can act as demand — a spot to go long.
• A bearish OB is the last up candle before a sharp move down — potential supply for shorts.

Why it works. Big orders can't all fill at once. When price returns to the origin of a strong move, unfilled institutional orders may still be resting there, defending the level.

What makes an OB high-quality:

• The move away from it was displacement — fast and gap-leaving, not a slow drift.
• It comes after a liquidity sweep (so the OB formed on a raid, not mid-range).
• It sits in the right half of the dealing range (discount for longs, premium for shorts — next module).

The order block is often the entry candle in an ICT setup. But it's rarely alone — its power multiplies when it overlaps a fair value gap.