orderblocks (simplified) a thread 🧵
Luckshury@Luckshuryy
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Apr 23, 2025
~2 min read
1
orderblocks (simplified)
a thread 🧵
a thread 🧵
2
what are orderblocks:
- the last up/sideways movement before an illiquid down move
- the last down/sideways movement before an illiquid up move.
illiquid typically can just mean a strong one time-framing move where there are no pullbacks.
example ↓
- the last up/sideways movement before an illiquid down move
- the last down/sideways movement before an illiquid up move.
illiquid typically can just mean a strong one time-framing move where there are no pullbacks.
example ↓
3
how orderblocks work (theory):
orderblocks are where there has been a clear sign of significant previous market activity, meaning a revisitation of this area could act as a stop gap.
for example:
the last down move before a significant up move is being revisited.
there are multiple reasons for price to react from this:
- offside shorts from this zone → closing positions at breakeven
- any new longs who entered here → defending their existing position
these zones are primed with liquidity (thicker books), allowing for larger players coming into the market to increase the chance they get orders filled.
example ↓
orderblocks are where there has been a clear sign of significant previous market activity, meaning a revisitation of this area could act as a stop gap.
for example:
the last down move before a significant up move is being revisited.
there are multiple reasons for price to react from this:
- offside shorts from this zone → closing positions at breakeven
- any new longs who entered here → defending their existing position
these zones are primed with liquidity (thicker books), allowing for larger players coming into the market to increase the chance they get orders filled.
example ↓
4
identifying the best levels:
the market will always advertise to many orderblocks, filtering between the many options by comparing volume is a great way to filter between them.
an orderblock zone formed through Friday/Saturday is less likely to form a significant level when pushed away from and revisited, due to its lack in volume.
to identify a precise level, I overlay a volume profile to identify the hvn or poc within the orderblock region.
example ↓
the market will always advertise to many orderblocks, filtering between the many options by comparing volume is a great way to filter between them.
an orderblock zone formed through Friday/Saturday is less likely to form a significant level when pushed away from and revisited, due to its lack in volume.
to identify a precise level, I overlay a volume profile to identify the hvn or poc within the orderblock region.
example ↓
5
executing from orderblocks:
trapped traders - new traders being caught offside heading into these levels can be great for mean reversions.
- volume spikes (relative volume)
- liquidation spikes
are both also things i look for when looking for a reaction from an orderblock.
example setup ↓
trapped traders - new traders being caught offside heading into these levels can be great for mean reversions.
- volume spikes (relative volume)
- liquidation spikes
are both also things i look for when looking for a reaction from an orderblock.
example setup ↓
6
There are a lot of pieces on orderblocks out there and I just wanted to post my approach to it all.
I think it’s important to come at sometimes traditional topics with your own viewpoints, as it helps for better implementation into your own system.
Thanks for reading and I hope you found this valuable.
Be sure to like the original post of this thread.
Let me know if you have any topics you want covered below or any other questions.
I think it’s important to come at sometimes traditional topics with your own viewpoints, as it helps for better implementation into your own system.
Thanks for reading and I hope you found this valuable.
Be sure to like the original post of this thread.
Let me know if you have any topics you want covered below or any other questions.