What it is
In smart money concepts (SMC) and ICT teaching, an order block is where larger players are thought to have built a position just before a strong move. On the chart it is simply the last down candle before a big up candle, or the last up candle before a big down candle.
WickSpeak makes the rule mechanical: a real displacement (a candle much bigger than normal) has to follow, measured against ATR (average true range, the average candle size).
How it is calculated
1. Measure each candle's body (close minus open) against the 14 period ATR. 2. If a body is at least 1.5 times ATR, it counts as a strong move. 3. Step back to the last candle before it that closed the other way. That candle is the order block. 4. The zone covers that candle's full range, from its low to its high. 5. A block before a rise is labelled demand; before a fall, supply. 6. The block is tapped when price later returns into it; by default tapped blocks are hidden.
Settings
| Setting | Default | Range | What it changes |
|---|---|---|---|
| move size (ATR) | 1.5 | 0.3 to 8 | How big the move after the block must be, in ATRs. Higher keeps only blocks behind very strong moves. |
| most recent | 8 | 1 to 40 | How many of the latest blocks are drawn. |
| when tapped | hide | hide or keep | Hide blocks once price has returned to them, or keep them on the chart. |
How to read it
How to trade it
- 1
Find an untapped demand block in an uptrend, for example on US30 15 minute after a break of structure up.
- 2
Entry trigger: price returns into the block and a candle closes bullish inside or just above it.
- 3
Stop: below the low of the block, typically 20 to 40 points on US30 15 minute.
- 4
Target: the high that the strong move made, or 2 to 3 times the stop.
- 5
Mirror it for supply blocks in a downtrend.
A long from a demand block is proved wrong if a candle closes below the low of the block.
WickSpeak draws demand and supply blocks as boxes on the chart and writes a plain-English reading: where the nearest block is, how to trade a return to it and the close that would prove it wrong. The 146 pattern scanner includes order blocks too.
Best markets and timeframes
Order blocks are used on every timeframe. On gold, US30 and NAS100 traders often take blocks from 15 minute to 4 hour charts and enter on 1 to 5 minute.
Common mistakes
- Trading blocks that have already been tapped several times.
- Picking blocks against the higher timeframe trend.
- Using a block that had no strong move after it, which is just an ordinary candle.
Works well with
Questions traders ask
What is an order block in trading?
It is the last candle that moved the opposite way before a strong move. Traders treat it as a zone where buying (demand) or selling (supply) may happen again when price returns.
How do you identify a valid order block?
It should be followed by a strong move, a candle body much bigger than normal (WickSpeak uses 1.5 ATR by default), and ideally that move should break structure. Untapped blocks are usually given more weight.
Is an order block the same as supply and demand?
They are closely related. An order block is a specific candle; a supply or demand zone is often drawn more broadly around the base of a move.
What happens when an order block breaks?
If price closes through it, the block has failed. Some traders then watch it as support or resistance from the other side, often called a breaker block.