Introduction to Order Blocks With Realtime Fibs Indicator

Table of Contents

The Order Blocks With Realtime Fibs indicator for Tradingview is a powerful trading tool that combines the concepts of order blocks and Fibonacci retracements. This comprehensive indicator can help traders identify potential areas of support, resistance, entries, exits, and target levels.

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What are Order Blocks?

In trading, order blocks refer to areas on a chart where a significant number of buy or sell orders have been placed by major market participants like banks and institutions over a short period of time. These blocks represent the “footprint” of where these large players entered or exited the market.

On a chart, order blocks typically appear as a range of consecutive bullish or bearish bars/candles with strong momentum. The theory is that when price returns to these areas, it may encounter the unfilled orders remaining and react off the liquidity.

Overview of Fibonacci Retracements

The Fibonacci retracement tool plots percentage retracement levels based on the key Fibonacci ratios of 23.6%, 38.2%, 50%, 61.8% and 78.6%. These levels indicate where the price may find support or resistance as it pulls back or retraces against a main trend.

Traders often use Fibonacci retracements to identify potential reversal points and entry levels after a period of trending price movement. The confluence of Fibonacci ratios with order blocks can be especially powerful.

Key Features of the Order Blocks With Realtime Fibs Indicator

Some of the standout features of this indicator include:

Customizable order block parameters – Traders can tweak settings like the number of consecutive bars, minimum price change, and other criteria needed to qualify an order block.
Automatic Fibonacci levels – Once an order block forms, the indicator will automatically plot Fib retracements from that level which update in real-time.
Retracement level selection – Users can pick which Fib levels like 61.8%, 78.6% they want to display.
Mitigation settings – Options for whether order blocks are mitigated by wicks/bodies and automatic hiding.
Color coding – Different colors for bullish and bearish blocks, retracement levels, etc for quick visual reads.
Alerts – Get notified when new order blocks form or when price reaches target Fib levels.

These settings allow traders to fine tune the indicator to suit their strategy and trading style.

How to Use Order Blocks With Realtime Fibs in Trading

When added to a chart, the Order Blocks With Realtime Fibs indicator scans historical price action and plots any order blocks it detects according to the defined parameters.

As new order blocks form when price moves aggressively up or down, the indicator will automatically draw Fibonacci retracements levels from the block’s high and low points.

These retracement levels are then used to highlight possible areas of support and resistance where reversals can occur as price returns to the order blocks.

Entries

Traders will look to enter new long positions as the price pulls back to the key Fib levels in an uptrend, with stops below the low of the order block.

Conversely, short positions can be taken when the price retraces to Fib levels in a downtrend, with stops above the high of the block.

Exits

Profit targets are often set at extension levels beyond the order block’s range, or at previous swing points where orders are likely clustered. If price breaks the high/low of a block, it may signal the order flow absorption is complete and trend resumption.

Stop Losses

Stops are typically placed just outside the high or low of the order block rectangle to allow for some wick movement. This contains risk on the trade while giving it room to work.

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Customizing the Indicator Settings

The Order Blocks With Realtime Fibs tool is highly flexible with many input parameters that can be adjusted under the indicator settings:

Order Block Inputs

Number of Consecutive Bars – Higher values detect more significant blocks.
Minimum Price Change % – Filters smaller blocks.
Body or Wick for Mitigation
Show All/Only Untested Blocks

Fib Retracement Inputs

Retracement Levels to Show – 23.6%, 38.2%, 61.8% etc
Extend Beyond Block
Fib Color

Experiment with these options to optimize the signals for any market or timeframe.

Tips for Using Order Blocks With Realtime Fibs

When using this indicator in your trading, keep these tips in mind:

Combine with other confluence factors – Volume, momentum oscillators, moving averages etc.
Focus on untested block levels – The initial retest offers highest probability.
Monitor both support and resistance blocks.
Be flexible on targets – Price may stall or overshoot Fib levels.
Use stop orders not market orders for entries.

Carefully plan trades around the levels identified by this tool for best results.

Conclusion

The Order Blocks With Realtime Fibs indicator available on Tradingview provides traders with a quick and efficient method of identifying and trading key support and resistance zones on charts.

By combining order flow concepts with Fibonacci analysis, it offers high probability setups for entries, exits and stop placements.

With its flexible input parameters, traders can fine tune the indicator to best locate opportunities across any market or timeframe.

If used properly in conjunction with sound risk management, the Order Blocks With Realtime Fibs tool can give traders an edge by revealing areas where substantial buying or selling interest exists.

So give this indicator a try today to take your price action trading to the next level!