Welcome to the Vertex Investing Order block playbook.
This will be your point of reference when using this strategy, whether it is the
risk entries or the safer entries. Using order blocks is all about understanding the story behind each trade and
understanding why order blocks exist and how they are used.
Understanding this will change your perspective on how you view the markets.
Order blocks (OB) are areas where Institutions are either buying or selling from,
these blocks are formed prior to a large impulse to an already pre-planned direction.
The reason we trade order blocks is that for the institutions to make a move
they need to grab liquidity first, this is from retail traders’ stopping losses, which
many retail traders call ‘stop hunts’. (DOWNLOAD ORDER BLOCK PlAYBOOK)
So institutions drive the price to grab this
before creating their desired move. Institutions do not use Stop losses, which
means although they have moved the market how they would like, they still have
a trade going the opposite way in heavy drawdown. So they drive prices back down
to mitigate their orders and then continue the move. This is where we come in with
our strategy. We look to enter at this mitigation and follow price with them.
This strategy is not overly difficult however requires practice to understand how