Order Block: A Complete Trading Guide For Beginners (2026)

What Are Order Blocks?

An order block is a price area on a chart where strong buying or selling happened just before a sharp move, often discussed in ICT trading. You’ll usually find it near the last candle before price moves away quickly, either up or down.

Traders pay attention to these zones because prices often react when they return to them, making them useful reference points for support and resistance.

These areas often form where there is sufficient activity to place larger orders without pushing prices too far. For retail traders, order blocks simply help highlight where the market reacted before and where it may react again.

How to Identify an Order Block

On a chart, an order block usually appears just before a strong price move. Instead of starting with indicators, it helps to watch how price behaves around the move itself.

In many cases, prices pause briefly before moving with momentum. When the price later returns to that area, it may slow down, reverse, or change direction around a fair value gap. 

Order blocks on higher timeframes, such as H4 or daily charts, are usually clearer and more reliable than those on very short timeframes.

Types of Order Blocks with Examples

Order blocks can appear in different forms, depending on how the price moves before and after the zone.

Below are the most common types of order blocks, explained simply.

Bullish Order Block

A bullish order block is a price area where buying showed up just before a strong move up. It often appears near the end of a downward move, close to the last bearish candle before price starts rising.

When price comes back to this area, it may slow down or bounce, which is why traders often see it as a potential support zone.

Basic risk idea:
Stops are usually placed just below the zone. If price moves straight through it, the level often loses relevance.

Bearish Order Block

A bearish order block is a price area where selling showed up just before a strong move down. It usually forms near the end of an upward move, close to the last bullish candle before price starts falling.

When price returns to this area, it may slow down or turn lower, which is why traders often treat it as a potential resistance zone.

Basic risk idea:
Stops are commonly placed just above the zone.

Breaker Block

A breaker block forms when price moves straight through an existing order block instead of reacting to it. When this happens, the level that once acted as support or resistance can start working the other way around.

For example, if price breaks above a bearish order block, that area may later act as support when price comes back.

Basic risk idea:
If price goes back into the old block and just sits there, that’s usually a bad sign. The move loses momentum. Clean breaks tend to make more sense than price hanging around and chopping.

Rejection Block

Sometimes price pokes into an order block, looks fine for a moment, and then gets pushed back. It doesn’t settle there. That’s the rejection block.

You’ll often see it around failed breakouts or quick turns. If price comes back later and goes through the level without any fight, that reaction stops being relevant.

Basic risk idea:

If the level doesn’t reject anymore, there’s nothing left to trade.

Vacuum Block

This is just an area where price ran through without much trading in between. No pauses, no structure.

When price comes back, it usually moves fast again for the same reason.

Basic risk idea:
Fast-moving zones can be harder to manage. Price may not react clearly inside them, so extra caution is usually needed.

How to Spot Valid and Invalid Order Blocks 

Not every order block is worth trading. Some levels look good on the chart but fail quickly when price comes back. Common signs of a weak or fake order block include:

• Price didn’t move away clearly after the block formed

• No push beyond a nearby high or low before the move

• The zone has already been tested or traded through (mitigation block)

• Price returns and moves straight through with little or no reaction

• The move looks slow or messy instead of clean and decisive

When these signs show up, the order block usually lacks strength. In those cases, it’s often better to skip the setup and wait for a clearer level.

Best Order Block Indicators for Beginners

Learning to spot order blocks by eye takes time. At the beginning, some traders use indicators to highlight potential zones, but they’re not required.

Most order block indicators just highlight zones where price moved fast or where trading activity was noticeable. They don’t really tell you if a level will hold or get broken. It’s better to see them as a guide on the chart, not as a signal to trade.

For many beginners, simple tools still work best. Watching volume helps you see if a move actually mattered. Checking recent highs and lows keeps the market context clear. In the end, what really counts is how price reacts when it comes back to a level, not the label you put on it.

Some traders use platform-based order block indicators on charting software like MetaTrader 4 or MetaTrader 5 to speed things up. Used properly, they can save time, but they work best when combined with simple price action and patience.

Basic Order Block Trading Strategy (Entry, Exit, Stop-Loss Rules, Timeframe)

Trading with order blocks is mostly about paying attention to how the price behaved before and what it does when it returns to the same area, often around a market structure shift.  There isn’t a fixed formula, and most traders keep things fairly simple.

When price returns to an order block, many traders don’t rush into a trade straight away. They watch the reaction first. Sometimes price slows down, sometimes it hesitates, sometimes it tries to push through and fails. Those small details usually matter more than the level itself.

If a trade makes sense, the stop-loss is normally placed just outside the block. Once the price moves beyond the zone and starts holding there, the idea is usually invalid. At that point, most traders are out.

Targets are often kept basic as well. A nearby high or low is enough for many setups. Others think in terms of risk and reward instead. The goal isn’t to catch every move, but to manage trades in a consistent way.

As for timeframes, a common approach is to spot order blocks on higher charts, like H4 or daily, and then look for entries on lower ones. This tends to make the levels clearer and helps keep risk under control.

Order Block Trading Risks 

Order blocks can be useful reference areas, but they don’t work every time. Some common risks to keep in mind include:

• Treating every order block as a trade, even when the price shows no clear reaction

• Entering as soon as the price touches the zone instead of waiting for confirmation

• Using order blocks in choppy or sideways markets, where levels tend to fail more often

• Ignoring stop-loss placement and risking too much on a single setup

• Expecting order blocks to work on their own, without considering market context

Conclusion

Order blocks are price areas where strong buying or selling has shown up in the past. On a chart, they help highlight spots where the price may slow down or react when it comes back.

They don’t work every time, and they are not a shortcut to profits. Still, they can add structure to your analysis and make it easier to think in terms of risk and context. Taking things slowly and keeping risk under control usually matters more than finding perfect trades.