LIVEOrder block in trading.
An order block is a candle in which smart capital has traded a large volume with the aim of accumulating a position.
Visually, it appears as the last bullish candle before an impulse drop and the last bearish candle before an impulse rise. The order block is a derivative tool of BTS/STB, as it follows the same logic in both formation and subsequent reaction (mitigation).
A correct order block is one that has been fully absorbed by the impulse movement and has small shadows. The candle's shadow does not affect the order block itself.
When returning to the order block (mitigation), the price is highly likely to react and reverse.
In practice, the price often receives a reaction from the body of the candle, while the shadows are ignored. It is considered that the main volume of orders/large capital was traded within the candle's body.
The ideal zone for reaction is considered to be 0.5 of the candle's body height.
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