I just realized that order blocks are an extremely powerful tool that many traders haven't fully exploited. It’s not just a different way to view supply and demand, but also a key to finding great entry points in trading.

Order blocks are basically price zones where, before a strong move, the last candle was formed. In other words, they are areas where trader psychology is deeply affected. When you understand order blocks, you can improve your trading skills in two main ways: identify effective reversal entry opportunities and determine price zones with strong momentum.

There are two types of order blocks you need to master. The first is the Bullish Order Block (BuOB) — the last bearish candle near support before a strong upward move in an uptrend. The second is the Bearish Order Block (BeOB) — the last bullish candle near resistance before a sharp decline in a downtrend.

When working with a Bullish Order Block, you will see a Bullish Engulfing candle appear immediately afterward, signaling the start of an uptrend. Similarly, with a Bearish Order Block, a Bearish Engulfing candle will follow, indicating the beginning of a downtrend. Setting entries, take profits, and stop losses is quite straightforward once you recognize this pattern.

But here’s an important point that many overlook: order blocks are only truly effective when you understand market structure well. Not every order block is a good trading opportunity. You need to combine it with Dow Theory and market structure analysis to know when to trade and when to wait.

In summary, an order block is a powerful supply and demand zone. When the price returns to these zones in an uptrend, that’s when you buy at the Bullish Order Block. When the price returns in a downtrend, you sell at the Bearish Order Block. It’s not complicated, but it’s extremely important for any trader looking to improve their strategy.

This is just a reference material to help you learn more about technical analysis methods. It’s not investment advice, but rather sharing knowledge so you can develop your own trading strategy.