Fair Value Gaps & Order BlocksAdvanced

Breaker Block

What a breaker block is: an order block that price closes through, which then acts in the opposite direction on the retest. Rules, examples and limits.

Library categories

What it means

A breaker block is an order block that failed. Price closed through it and then, on the retest, the same zone worked in the opposite direction: a failed bullish order block becomes resistance.

Breakers usually appear after a liquidity sweep and a change of structure.

Why traders use it

The traders who bought the bullish block are now trapped; when price returns to their entry area, some exit at break-even, adding selling pressure.

Chart examples

Bullish order block fails and becomes a bearish breaker

OB failsRejectedBullish OBBearish breaker
Price closes below the bullish block, then rallies back into it and is rejected.Schematic diagrams drawn to explain the idea; they are not market data.

How to identify it objectively

  • 1Mark a bullish order block (or bearish).
  • 2Price closes below its low (above its high for bearish).
  • 3The zone is now a bearish (or bullish) breaker.
  • 4Watch for a retest from the other side and a rejection close.

Bullish use

  • 1A bearish order block is broken upward.
  • 2Price retests it from above.
  • 3A bullish rejection confirms the bullish breaker.

Bearish use

  • 1A bullish order block is broken downward.
  • 2Price retests it from below.
  • 3A bearish rejection confirms the bearish breaker.

What confirms it

  • A close through the original block.
  • A clear structure change in the new direction.
  • Rejection on the retest.

What invalidates it

  • A close back through the breaker in the original direction.

How a hypothetical setup is built

Entry

At the retest of the breaker with a rejection close.

Stop

Beyond the breaker zone.

Target

The next liquidity pool in the new direction.

A hypothetical illustration of how the concept is turned into a plan, not a recommendation. Practise it on a paper account first.

Historical testing

Not tested on The Tradeskill yet.

Limitations: when it fails

  • Depends on correct order-block identification first.
  • The retest may never come.
  • Wicks through the block create ambiguous cases; use closes.

Knowledge check

Pick an answer to see the explanation. Nothing is saved.

A breaker is…

1. A breaker is…

What turns a bullish OB into a bearish breaker?

2. What turns a bullish OB into a bearish breaker?

How is the breaker traded?

3. How is the breaker traded?

Practise it risk-free

Open the free chart, use replay to go back in time and look for this concept candle by candle with $20,000 in virtual money.