I have just compiled some experiences about what an order block is and how to apply it in trading, which may be useful for those of you exploring technical analysis.

Simply put, what an order block actually is, is a special price zone — where large traders have accumulated their orders before the price makes a strong move. It offers a different perspective on supply and demand, helping us find quality entry points for reversal or continuation trades.

There are two main types you need to know:

Bullish Order Block (BuOB) — this is the last bearish candle near the support level before the price starts to rise sharply. When you see a bullish engulfing candle afterward, it’s a strong entry signal. You would place an order in this order block zone, take profit at the resistance levels above, and set a stop loss below the support.

Bearish Order Block (BeOB) — conversely, this is the last bullish candle near the resistance before the price drops sharply. A bearish engulfing candle afterward confirms it. The strategy is similar but reversed — enter a sell order, take profit at the support below, and set a stop loss above the resistance.

But here’s the important part: you shouldn’t always trade just because you see an order block. You need to understand market structure, the current trend, and Dow theory. Order blocks are only effective when they are in the right market context.

Actually, what an order block is, is also a powerful supply-demand zone. It helps improve your trading skills by identifying effective entry opportunities and recognizing price areas that significantly influence trader psychology. The way to identify it is quite simple, but extremely important if you want to trade with a plan.

In summary: buy when the price touches a bullish order block in an uptrend, sell when it touches a bearish order block in a downtrend. But remember to combine this with market structure analysis to avoid traps.

This is just a sharing of analysis experience, not investment advice. Everyone should find a method that suits themselves.