Drawing order blocks step by step

A simple routine

You can find order blocks with a repeatable checklist. Practise it on the chart in the Order Blocks exercise.

Step 1: Find a break of structure

Scan for a candle that closes above the most recent swing high. A swing high is a candle whose high is higher than the few candles on each side. That close is your signal that buyers took control.

Step 2: Find where the move started

Look back from the breaking candle to the lowest point of the move that caused the break. That's where the impulse began.

Step 3: Pick the last down candle

At or just before that low, find the last red candle. That candle is your bullish order block.

Step 4: Draw the zone

Draw a rectangle from that candle's high down to its low, and extend it to the right. Some traders use only the candle body (open to close) for a tighter zone. Both are valid, but be consistent.

For a bearish order block, mirror everything: a close below a swing low, the highest point of the drop, and the last green candle.

Refinements

• Fresh vs mitigated: once price has closed through the far side of the zone, it is considered used up (mitigated). Fresh zones are usually more interesting.
• Size matters: a very tall candle makes a wide zone. Some traders refine it on a lower timeframe to find a smaller candle inside it.
• Context: a bullish order block in an overall uptrend lines up with the bigger picture. One against the trend is riskier.

Let the bot check you

Add Order Block Bot from the Studies menu (Bots category). It applies exactly this routine. Draw your own zones first, then turn the bot on and compare.