A price zone marked by a candle wick that shows strong rejection, often representing institutional activity.
Deep Dive
A rejection block is a zone marked by a significant candle wick that shows price was strongly rejected from that level. Unlike traditional order blocks (which use candle bodies), rejection blocks highlight areas where price was defended by institutional activity through rapid rejection.
Rejection blocks form when price attempts to penetrate a level but is immediately pushed back, leaving a long wick. This shows that significant orders were sitting at that level, defending it. When price returns to that level, similar defense may occur.
Rejection blocks are often found at the wicks of pin bars, hammers, shooting stars, and similar rejection candles. They represent areas of institutional interest that may not be visible through body-based order block analysis alone.
Why It Matters
Rejection blocks provide entry zones where smart money previously defended a price level.
Related Terms
- Hammer — Bullish reversal bar with long lower tail and small body at the top showing rejection of lower prices.
- Liquidity Sweep — Liquidity Sweep is a trading concept. Liquidity Sweep: A rapid, often volatile, price movement designed to "sweep" available liquidity (buy or sell orders) at a
- Order Block — Order Block is a trading concept. Order Block: A specific candlestick or series of candlesticks on a chart that represents a key institutional order flow point
- Pin Bar — Bar with small body and long tail showing rejection of prices beyond the tail.
- Shooting Star — Bearish reversal bar with long upper tail and small body at the bottom showing rejection of higher prices.