Trader's Glossary

Order BlockOrder Block (OB)

The last opposite-coloured candle before a strong impulsive move. Marks where institutional orders were filled — acts as future support/resistance.

An Order Block is the final candle of the opposite colour before a strong, impulsive move in the new direction. A bullish OB = the last red candle before a strong up-move. A bearish OB = the last green candle before a strong down-move. These zones mark where large institutional orders were filled.

Unmitigated order blocks (those price hasn't yet returned to) act as future S/R. The strategy: wait for price to retrace into the OB, confirm with a reaction candle, then enter in the original direction. OBs work because institutions need to fill remaining orders — they can't dump $500M in one print, so they revisit.