What Happen If Price Action Does Not Bounce From OB? Here’s 5 Breakdown Of Explanation

What happen if price action does not bounce from OB, or Order Block? Here’s the simple explanation to have a better understanding of market for traders and investors.

WartaBerita.Net | NEW YORK – If price action doesn’t bounce from an Order Block (OB) and instead breaks through it, the movement suggests that the established support or resistance level has failed.

If the question of “What happen if price action does not bounce from OB” does happen, this can indicate a continuation of the current trend, potentially leading to further price movement in the same direction.

The explanation of What happen if price action does not bounce from OB

In order to answer the question of What happen if price action does not bounce from OBF, we need to look for this example: If price breaks through an OB that was acting as support, it suggests the downtrend is likely to continue, while a break of an OB that was acting as resistance suggests an uptrend is likely to continue.

Here’s a more detailed breakdown:

Failed Support/Resistance; An OB acts as a level where buyers or sellers have previously shown significant interest, creating a price point where a bounce or reversal is expected.

Breakout; If the price moves through the OB, it indicates that the previous buying or selling pressure is insufficient to hold the price at that level.

Trend Continuation; A break of a support OB suggests the price is likely to continue falling, while a break of a resistance OB suggests the price is likely to continue rising.

Increased Volatility; Breakouts, especially through significant OBs, can be accompanied by increased trading volume and price volatility as the market adjusts to the new price direction.

Trading Implications; Traders often use OBs to identify potential entry or exit points. If an OB fails, it might signal a need to adjust trading strategies, such as tightening stop-loss orders or re-evaluating the trade based on the new price action.

Confirmation of What happen if price action does not bounce from OB can be seen when a successful breakout is often followed by a retest of the broken level. If the price fails to return to the level after the breakout, it reinforces the strength of the breakout. [WB]