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
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.
Related concepts
- Fair Value Gaps & Order BlocksOrder Blocks
- Fair Value Gaps & Order BlocksMitigation Block
- Fair Value Gaps & Order BlocksInverse Fair Value Gap (IFVG)
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.