I just realized that Order Block (OB) is actually one of the most powerful tools that many traders overlook. Today, I want to share how I use it to find high-quality entry points.

What is an Order Block? Simply put, it is a specific price zone — precisely the last candle before the price starts moving strongly. Instead of just looking at supply and demand in general, Order Blocks allow me to identify extremely effective entry points for both reversal and continuation trades.

There are 2 types of OB that I usually work with: Bullish OB and Bearish OB. A Bullish OB appears when there is a bearish candle near Support, followed by a strong price increase — this is a buy signal. Conversely, a Bearish OB is a bullish candle near Resistance before the price drops — this is a sell signal.

In practice, when identifying what an Order Block is on my chart, I often look for a Bullish Engulfing candle after a Bullish OB or a Bearish Engulfing after a Bearish OB. Those are the strongest signals. Then, I set my Entry in the OB zone, Take Profit at the next resistance level, and Stop Loss below Support (if it’s Bullish) or above Resistance (if it’s Bearish).

But remember, understanding what an Order Block is must also be considered within the context of the overall market structure. I only trade OBs when they align with the main trend — if the market is in an uptrend, I look for Bullish OB; if in a downtrend, I wait for Bearish OB. That’s the key to avoiding false trades.

In summary, understanding what an Order Block is and how to use it has changed my trading approach. It’s not a holy grail, but combined with market structure and Dow Theory, it becomes a very reliable tool. You can try applying it to currency pairs or altcoins on Gate to see the results.