Rejection block

What it is

A rejection block is built from wicks rather than bodies. At a swing high where an old high was raided, the candles leave long upper wicks; the zone runs from the top of the bodies up to the wick high. A bullish rejection block mirrors this at a swing low, from the bottom of the bodies down to the wick low.

The long wicks show that price was pushed into the area and quickly rejected, so the area often rejects price again on a return.

How to spot it

• A swing high or low that ran an old high or low.
• One or more candles with long wicks there, and bodies bunched together.
• The block is from the highest body (bearish) or lowest body (bullish) to the wick extreme.

How to use it

• Look for a short when price trades back up into the wicks, with the stop just beyond the wick high.
• A candle body closing beyond the wick extreme cancels it.

Common mistakes

• Drawing it from the candle's whole range; it's only the wick part.
• Using wicks in the middle of a range, where nothing was raided.

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