Behind every strong move on the chart there is always an imbalance: a zone where many orders were executed in a very short time. That zone is called an order block and it reappears time and again as a price reference.
What an order block is
An order block is the last bullish (or bearish) candle before the impulse. In an uptrend, the block is the last bearish candle before the breakout: that is where the buy orders that pushed price originated. When price returns to that zone, it tends to "remember" it: institutional traders protect their positions and price reacts.
How it forms
- An accumulation candle appears (the last pullback before the impulse).
- Price breaks the high (or low) and the institutional move begins with wide candles.
- Traders who missed the move look to get back in: price returns to the block zone and reacts (retest).
The breakouts that most often respect their blocks are the ones born from a range or a major session (for example, the London open or the London–New York overlap, with their characteristic volume).
Order block vs. support and resistance
| Support / resistance | Order block | |
|---|---|---|
| What it marks | A horizontal price level | A specific candle: the origin zone of orders |
| Direction | Neutral (price bounces or breaks) | Carries the direction of the impulse that created it |
| Use | Targets and reversals | Retest entries and stop management |
Order blocks and support/resistance levels don't compete: they reinforce each other. An order block aligned with a historical high or low and a liquidity zone is a far more powerful combination than each element on its own.
How to detect them automatically in TradingView
Detecting blocks by hand is slow and subjective. In Pine Script the whole process can be automated:
- Breakout detection: the indicator watches for the breaking of highs (bull) or lows (bear).
- Locating the imbalance candle: the last candle that was not exceeded before the impulse.
- Drawing the block: the zone extends to the right with configurable border and fill.
- Recycling vs. overflow: maximum of 12 visible blocks at once, removing the oldest (FIFO), and a single alert per block breakout.
The Todo lo posible indicator does exactly that: it automatically detects bullish and bearish breakouts, draws blocks extended to the right and alerts when price breaks the latest active block.
Tips for trading the retest
- Wait for confirmation: a rejection candle inside the block is worth more than a direct market entry.
- Look for confluence: block + support/resistance + EQH/EQL liquidity zone or a structure EMA.
- Define the invalidation: if the block is fully broken, the thesis changes; place the stop outside the imbalance.
- Change context by timeframe: in intraday, use M15/H1 blocks; in swing, H4/D1 blocks.
Automatic order blocks with retest, EQH/EQL liquidity, S/R, divergences across 5 oscillators and 33 alerts, all on price. €10, one-time payment.
Frequently asked questions
What is an order block in trading?
It is the last bullish or bearish candle before a strong institutional move: the zone where the orders that originated the impulse accumulated and that tends to react when price returns to it.
What is the difference between an order block and a support or resistance level?
Support or resistance is a horizontal level; an order block is a specific candle that carries the direction of the impulse. They complement each other.
How are order blocks detected automatically?
The indicator detects the breakout of a high or low, locates the prior imbalance candle and draws the block extended to the right with configurable style.
Are order blocks reliable?
They are zones of interest, not certainties. Their reliability rises with confluences (support, liquidity, EMA) and with proper stop management.