Orderblocks Simplified - ICT Concepts

[00:08] going to cover order blocks how I identify them and how I use them in my trading the first thing we're going to do is how I identify them and then we will go through examples on how I use them so with this diagram here the first

[00:21] thing we look for in a bearish order block example is a sweep of a high the next thing we look for is a breaker structure down this is when our order block is valid so where is our order block the up close or

[00:36] series of up close candles which took or swept this liquidity before the move swept this liquidity before the move down normally in this area right in here there are many ways different ways you can use this my favorite is the opening

[00:51] price of this candle or series of candles however you can also use the wick or the mean threshold we will get into that into our examples similarly with the bullish order block we want to see a sweep of sell side before breaking

[01:06] structure up and then identifying the series or single down close candles before they move up and that would be our bullish order block I also want to discuss what I consider to be a high probability order

[01:19] Block in a low probability order block and how I use each so with high probability order blocks such as these with large candle bodies and small Wicks with large candle bodies and small Wicks I prefer to use the opening price of

[01:33] this candle similarly with a bearish order block I would use the open ear now with ordered blocks such as these on the right that is when I prefer to use

[01:45] the right that is when I prefer to use the wick or the wick to the open so for example on this bearish order block I would use the wick to the opening price and that would be what I would use generally I only use the low probability

[01:59] order blocks when we are either in a downtrend or uptrend and that is the only up close or down close Candle on the Range I will then use the wick to the open of that candle and that will be my point of Interest or entry so now

[02:16] that you understand the structure and what we are looking for let's move to the charts and find some examples for our first example we are going to be block so we are on the five minute es chart

[02:30] here and we will replay price so if you can see we are moving down we just broke this low we want to see if we displace below it or if we come back into the range as we continue ahead

[02:47] you can see we are coming back into the range sweep and our displacement so if you look where did we break

[02:59] structure right here so where is our order block and is it valid the down closed Candle on the Move That swept the liquidity before the break is structured up is this candle right here now some of you may be asking why not this little

[03:13] candle right here I want the big full-bodied candle on they move down full-bodied candle on they move down that swept below so I'm marking this out this is the order block I am interested in and I would like to see a support

[03:26] price so as we continue ahead

[03:39] get another leg up off of this area or this bearish example we are going to use the mq one hour chart so if we're looking at this High did we so if we're looking at this High did we sweep by side yes right here now did we

[03:54] break the structure down not yet so let's skip ahead and there we go we break our structure down where would be our up close Candle

[04:06] on the Move That swept liquidity before breaking the structure down breaking the structure down right here the open of this candle here so ideally as we play ahead we should get a move or have price be resistant to

[04:22] get a move or have price be resistant to that area when price is trending and there are down close candles in that move so for example here we have these two down closed candles here I would look for

[04:37] price to be sort supported in here now why choose that or that candle versus this one well if you move up a time frame that becomes a single candle that

[04:49] is why you get the series of candles and not just a single candle going back into another thing I will look for is when we have these single small Body candles here and I will do the same thing looking for price to be supported by

[05:05] looking for price to be supported by that and we get a move higher for our last and final example we are going to run through some price action and showing you how when price is moving in one

[05:21] direction towards a higher time frame PD array it is likely to respect bullish or bearish order blocks along that range up so for example here we sweep this low come back into the range and break

[05:37] structure here is the low being swept here is our brachet structure right here here is our brachet structure right here and here is our order block now as we displacement up into this area before returning to the fair value Gap and

[05:50] Order block so there we go we reach up into you should be able to see it now r bearish order block right there swept

[06:02] this High broke structure down now we want to see if we return and get supported here there you go you can see we dropped down and price does get supported by this

[06:17] order block now as we go higher where is our next order block you see this large our next order block you see this large down closed candle that swept this low before I move higher I want to see price being supported here

[06:37] I went a little ahead of myself but as we reach higher here we have a down closed candle into a fair value Gap we would want to see this be supported as well and so on until you reach your higher

[06:51] time frame objective I would say experiment with the open versus the wick and single versus series and figure out what works for you and what you enjoy

[07:03] the most the last thing I'm going to cover is what is the mean threshold of an order block all it is is from body high to body low all it is is from body high to body low 8.5 FIB of that area so instead of

[07:17] possibly using the open of this order block as we showed in the last example you can look to enter on the mean threshold which you can see worked fairly well right there the reason I find benefit in

[07:32] using the mean threshold is using my entry on the open I would have to have my stop here or at the low versus with the mean threshold you can

[07:44] versus with the mean threshold you can see my stop size reduces from 3.5 points see my stop size reduces from 3.5 points to 1.75 points I hope you found this video helpful and useful if you have any questions please leave them in the

[07:56] comments below and I will do my best to get to them as quick as I can for those of you interested I did make a separate channel for back testing I will leave a link in the description below if you are interested in checking that out I hope

[08:09] interested in checking that out I hope you have a good one see you later