CHAPTER 4

PD Arrays I: Gaps and Order Blocks

PD arrays are the priced zones where institutional orders live. Once you can mark them, your entry stops being a guess and becomes a limit order at a defined price.

4.1The PD Array Family

Array	Definition in one line
Fair Value Gap	A three-candle gap where almost no trade occurred
OB	Last opposing candle before displacement
Breaker	An OB that failed and now works from the other side
Mitigation	Where trapped orders are allowed to exit
Rejection	A cluster of long wicks
VI	Body gap while wicks overlap
Void	A one-sided fast run with almost no trade
Inversion FVG	A failed FVG that now works in reverse
Optimal Trade Entry	62 to 79 percent of the leg
CE	The exact 50 percent of an FVG

4.2Fair Value Gap

In a three-candle sequence, if the middle candle is so large that the bodies of candle one and three never touch, the space between them is the FVG. It means price was not balanced there, and the market tends to return.

**Fig. 4.1** Bullish FVG: long at the CE of the gap, stop below

**Fig. 4.2** Bearish FVG: short only when it sits in premium

Quality = gap size divided by average candle size. Bigger is better.
CE - the 50 percent of the gap, the most reliable entry line.
A smaller FVG inside the big one is nested - the strongest version.
An FVG formed outside a killzone is usually weak.

4.3Order Block

The OB is the last candle immediately before the displacement: the last green candle before a bearish move, the last red candle before a bullish move. That is where the institution parked its bulk order.

**Fig. 4.3** Bullish OB: long the retest of the last red candle

**Fig. 4.4** Bearish OB: the last green candle, in premium

Conditions for a good OB	Reason
Displacement broke structure	Proves real orders were there
The OB contains or touches an FVG	Two reasons meet at one price
Correct premium or discount	An OB at the wrong price gives poor R:R
Created inside a killzone	Orders from active hours
First retest	Each retest weakens the OB

4.4Breaker Block

When an OB is violated by a body close, everyone who entered there is trapped. That failed zone then works from the opposite side - that is the breaker.

**Fig. 4.5** A violated OB becomes a breaker

4.5Mitigation Block

A mitigation block is where price returns to let trapped positions exit at break-even. It is not fresh demand like an OB; it is where old damage gets repaired.

**Fig. 4.6** Mitigation: the exit door for trapped longs

4.6Rejection Block and Volume Imbalance

Two smaller but useful arrays. The rejection block is a cluster of long wicks - a price that kept rejecting. The volume imbalance is a body gap where wicks overlapped but bodies did not.

**Fig. 4.7** A cluster of wicks is a rejection block

**Fig. 4.8** Volume imbalance: a gap between bodies

4.7IFVG: The Failed Gap

If an FVG is broken by a body close it is no longer an entry - it is now a zone in the opposite direction. This is where many traders go wrong: they keep buying an FVG that has already failed.

**Fig. 4.9** The failed FVG flips into resistance

4.8Nested Arrays: Two Timeframes, One Price

The best entry is a lower-timeframe zone inside a higher-timeframe zone: a 5-minute FVG inside a 4-hour FVG. Two kinds of traders are buying the same price.

**Fig. 4.10** A small zone inside a big zone is a precise entry

4.9Ranking the Arrays

Rank	Array	Why
A+	Nested FVG, OB and OTE at one price	Three independent reasons at one price
A	OB plus FVG, in a killzone, in discount	All conditions met
B	A single FVG or OB	One reason; tradeable with good R
C	Volume imbalance, mitigation	Confluence only
X	Liquidity void	A target, never an entry

Educational material only · not financial advice.