Where the idea comes from
A fund that wants to buy a very large amount cannot simply buy it — there is not enough on offer at one price, and trying would move the market against itself. So it accumulates, in pieces, over a range, and often after pushing price down to where the sellers are. That is a real constraint on large participants and it is the honest foundation the whole vocabulary sits on.
An order block
The last opposite-coloured candle before a strong move away. Before a hard move up, the final down candle; that is where the buying was happening while the chart still looked bearish. The idea is that unfilled orders remain in that area, so price returning to it may find buyers again. Treat it as a zone of interest with a stop below it, not a wall.
A fair value gap
Three candles where the middle one moves so fast that the first candle’s wick and the third candle’s wick do not overlap. That untouched space is the gap. Price often — not always — comes back through it later, and this is where the language gets dangerous: you will read that the market must return to fill it. It does not. Plenty of gaps are never revisited, and a plan built on the word must is a plan with no stop in it.
Liquidity, in plain words
Above an obvious high sit buy orders — stops from sellers, and breakout entries. Below an obvious low sit sell orders. Those clusters are what the vocabulary calls liquidity, and price reaching for them is not a conspiracy; it is orders being filled where orders exist. This is the same mechanism as the fakeout lesson, described from the other side.
What to keep and what to discard
Keep the mechanism: large orders need to be filled somewhere, so areas of prior activity are areas of likely activity, and obvious highs and lows have orders sitting past them. Discard the certainty. There is no way to see institutional orders on a retail chart, anybody who says they can is selling something, and an order block is in the end a support zone with a more confident name. Used as zones with stops it is a reasonable method; used as prophecy it is a very expensive one.
In short
| Order block | Last opposite candle before a strong move |
|---|---|
| Fair value gap | Untouched space across three candles |
| Liquidity | Order clusters past obvious highs and lows |
| Gaps are filled | Often — never always |
| Visible on a retail chart | The zones, not the orders |
Common questions
Can I actually see institutional orders?
No. You can see where price moved sharply and infer that something was there. That inference is all any of these tools are, and calling it more than that is where the losses start.
Does price always come back to a fair value gap?
No. It frequently does and it frequently does not. Any version of this idea containing the word "must" is wrong, and trading it without a stop because of that word is the specific way people lose money with it.
Is this different from support and resistance?
Not fundamentally. It is a more precise way of choosing which zones to care about, with a stronger story attached. The story is worth less than the precision.
Trading forex and CFDs on margin carries a high level of risk. Most retail accounts lose money. Nothing on this page is financial advice or a recommendation to trade.