REJECTION BLOCK

PRESSURE & LIQUIDITY

ICT Rejection Block VS Order Block

Both order block and rejection block are ICT PD array used to initiate a trade.

Both are reliable for trading with one difference.

Order Block may be found in between at 50%, 62% or 70% retracement level but the ICT rejection block will always be found
at 80% or 90% retracement level.

So using ICT rejection block will increase your risk/reward ratio because in this setup your stop loss will be lower the the order
block setup.
Phychology behind the Rejection Block
Why Does a Rejection Block Form?
Rejection Block - Trading Plan
KEY POINTS
 Rejection blocks are formed when the price sharply moves to a level but is quickly rejected, leaving a prominent wick or
shadow on the candlestick.
 They act as dynamic zones of support or resistance. When the price revisits them, it often reacts at that level again,
making these blocks useful for predicting potential reversals or continuations in price movement.

 When trading rejection blocks, we highly recommened that you wait to see a confirmation of your bias before you enter
the trade.

Rejection blocks are a concept in ICT (Inner Circle Trader) trading that represent long wicks at the top or bottom of a
swing, preferably sweeping liquidity with those wicks before a reversal to shift market structure.

Rejection Blocks occur at areas on the chart where the price strongly rejects a specific level, indicating a temporary shift
in market sentiment. These blocks act as dynamic zones of support or resistance, where price movement sharply
reverses, often due to significant buying or selling pressure.
1. Bullish ICT Rejection Block
The bullish rejection block forms at the bottom of a swing low on the wicks of the lowest candlesticks before a market structure shift. Usually, the price
returns to this level and then reverses to the upside like it would at a bullish order block. The bullish rejection block is drawn from the lowest wick’s tip
to the lowest candlestick’s open or close.

2. Bearish ICT Rejection Block

A bearish rejection block forms at the top of a swing high on the wicks of the highest candlesticks before a market structure shift. On returning to this block,
the price tends to reverse to the downside like it would at a bearish order block. The bearish rejection block is drawn from the highest wick’s tip to the
highest candlestick’s open or close.
How Do You Identify A Rejection Block?

1. Locate the areas where rejection blocks are likely to form.

Rejection blocks will likely form at three areas: swing highs or lows, supply or demand levels, and after the sweep of liquidity.

When you see candlesticks at the extreme swing of the price having long wicks before reversing, it suggests that the price tried to go further, but
the opposing side of the move was strong enough to reject the movement and turn the trend around. That’s how rejection blocks form at swing
points.

2. Observe the most extreme candle(s) open/close and its wick(s).

At that swing point, pick out the candle(s) that have its close price at the farthest point. And in a swing low, you’re looking at the bullish or
bearish candle(s) whose open or close, respectively, is the lowest.
3. Mark out the wicks
Next, you mark out the wick(s) from the open/close of the most extreme candlestick to the tip. This width is your rejection block. And if you have
multiple candles at the extreme end, you mark out the wicks starting from the farthest body’s open or close to the tip of the longest wick.

PRO TIP: Look for bullish rejection blocks in bullish trends and look for bearish rejection bocks in bearish trends.
How to Trade Rejection Blocks
Many trading strategies make use of the ICT Rejection Block. Let’s show a simple rejection block trading strategy
with a GBPUSD chart example on the 1-hour chart.
In our GBPUSD example above, the price retraced to our rejection block. The overall trend is bearish on the hourly chart, and we’re looking to continue the
trend from the rejection block. But we don’t enter immediately the price taps the rejection block. Rather, we go to the 5-minute timeframe to see if something
suggests a reversal.

There, we find a market structure shift and a displacement, leaving two Fair Value Gaps behind. This, for us, is a clear sign that the price is
gearing up for a reversal.

Your profit target, however, can be more flexible, depending on your trading strategy or style. For instance, you
can take profit at the next significant supply or demand, high or low, or even on a higher time frame level. You
could even use an opposing rejection blocks as your exit points. There are so many ways to go about this. But to
keep things simple, just go for a 1:1.5 of 1:2 risk-to-reward ratio. You can also backtest this ratio and journal
your trades to know where exactly is the best to place your profit target.

Trade Entry and Exit

The first thing to do is identify your rejection block, preferably one that has cleared liquidity. Once you have that,
you can wait for the price to return to it and see how things react.
Aggressive traders will place their trade entry just at the rejection block, which makes sense if the larger market
context is right. However, we recommend that you wait for some form of confirmation before you place your
trade at a rejection block. This confirmation could be in the form of a change of character or market structure
shift on a lower timeframe, a clear displacement in the right direction that leaves an FVG behind, or
even candlestick patterns like the engulfing bar.