What Are Order Blocks?

An order block is the last opposing candle before a strong, impulsive move — the zone where institutions are believed to have absorbed orders and built a position before driving price away. A bullish order block is typically the last down-candle before a sharp rally; a bearish order block is the last up-candle before a sharp drop. Think of it as the institutional footprint left at the origin of a move.

Why order blocks matter

Institutions cannot fill a large position in one click without moving price against themselves. They accumulate at a level, then push. When price later returns to that origin zone, the remaining institutional orders often defend it — which is why order blocks act as support/resistance with a reason behind them, unlike arbitrary lines.

What makes an order block valid

• It precedes a strong, impulsive move (ideally one that breaks structure).
• The move away often leaves a Fair Value Gap — confirmation of genuine imbalance.
• It is unmitigated — price has not yet returned to it. A fresh order block is stronger than one already tested.
• It aligns with higher-timeframe context (a bullish OB inside an uptrend is higher-probability).

Trading order blocks with liquidity

The highest-probability sequence ties it all together: price sweeps a liquidation cluster (grabbing stops), then returns to an order block that overlaps a Fair Value Gap, then reacts. The sweep provides the fuel, the order block provides the entry, and the FVG confirms the imbalance. Ampeld maps the clusters so you can see exactly where that liquidity sits relative to your order block. Try it free on the web terminal.