OrderBlock

📊 Understanding Different Types of Order Blocks in Trading

In the world of trading—whether it’s Forex, stocks, or crypto—price does not move randomly. Instead, large institutions and smart money investors leave behind “footprints” in the form of Order Blocks. These are key areas on the chart where a significant number of buy or sell orders are placed, often leading to strong price movements.

An Order Block is essentially a supply or demand zone created by institutional traders. For retail traders, identifying these zones is crucial because they reveal where the “big money” is entering or exiting the market. Recognizing these levels can help traders anticipate future price action and make smarter trading decisions.

The image highlights six major types of Supply Order Blocks:

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1️⃣ Evening Star 🌟

The Evening Star is a bearish reversal pattern that often appears at the top of an uptrend. It signals that buying pressure is weakening and sellers are stepping in with strength. When this pattern forms inside a supply zone, it often confirms a strong reversal, pushing the market downward.

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2️⃣ Indecision ❓

Indecision candles reflect market uncertainty, where buyers and sellers are equally matched. These formations often lead to sudden, sharp moves once one side gains control. When such indecision appears at a supply level, it usually resolves in favor of sellers, creating powerful bearish momentum.

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3️⃣ Manipulation 🎭

Also known as a “stop hunt”, manipulation happens when price briefly moves in the opposite direction to trap traders. For example, the market may fake a bullish breakout before crashing down. These manipulative moves are common around supply zones, where smart money lures retail traders into wrong positions before taking the real direction.

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4️⃣ Marubozu 📉

A Marubozu candle is a long candlestick with no upper or lower wick, showing one-sided market dominance. A bearish Marubozu inside a supply order block signals overwhelming selling pressure, leaving little doubt about the direction of the market. It’s one of the strongest confirmations of institutional selling.

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5️⃣ Pin Bar 📍

The Pin Bar is a candlestick with a long wick and small body, indicating rejection of higher prices. When found at a supply zone, it shows that buyers attempted to push the price higher but failed, and sellers took control. This is a highly reliable reversal signal for traders.

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6️⃣ Engulfing 🔥

The Engulfing pattern occurs when a bearish candle completely covers (or “engulfs”) the previous bullish candle. This is a strong sign of reversal, particularly when it happens inside a supply order block. It demonstrates that sellers are aggressively entering the market, overpowering buyers.

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🔑 Why Order Blocks Matter

They highlight institutional activity (where smart money trades).

They act as strong support or resistance zones.

They help traders identify high-probability entry and exit points.

They reduce the risk of trading false breakouts.

By mastering these order block patterns, traders can align themselves with institutional moves rather than getting caught in retail traps. This improves not only trade accuracy but also overall consistency in the market.

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🚀 Conclusion

Order blocks are one of the most powerful tools in price action trading. Whether you’re trading forex, crypto, or stocks, learning how to identify and confirm different order block types—such as Evening Star, Indecision, Manipulation, Marubozu, Pin Bar, and Engulfing—can give you a strong edge.

Trading is not about predicting the market; it’s about following the flow of smart money. 📈 By recognizing these supply patterns, traders can step into the market with confidence, discipline, and precision.

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