Introduction
Breaker blocks are a powerful entry concept that tie together points of interest, stop hunts, and displacement. In simple terms, a breaker block is just a failed order block. When combined with fair value gaps and liquidity runs, it creates a reliable structure for precision trading.
What is a Breaker Block?
A breaker block forms when price runs liquidity and invalidates a prior order block. Traders who entered on that order block get trapped, and the breaker becomes a new level to trade from.
Bullish breaker: The move up before the move down that runs liquidity, followed by displacement higher.
Bearish breaker: The move down before the move up that runs liquidity, followed by displacement lower.
Key Conditions for a Valid Breaker
Must be formed around a swing high or swing low that gets run.
Price must displace through the level, leaving a fair value gap.
A close above (for bullish) or below (for bearish) confirms the breaker.
Entry is placed at the wick or body of the breaker block.
Example: Bullish Breaker
A 15M point of interest aligns with a stop hunt.
Price displaces higher through the breaker block, leaving a fair value gap.
Entry comes on the retest of the breaker with targets set at nearby highs.
Example: Bearish Breaker
Price makes a move down, then up to run liquidity.
A stop hunt aligns with a higher timeframe point of interest.
After displacement lower and fair value gap formation, the retest of the breaker becomes the short entry.
How Breakers Fit Into the Model
Breakers aren’t used in isolation. They work best when combined with:
Points of interest: Higher timeframe zones that frame the trade.
Stop hunts: Liquidity runs that set the stage for displacement.
Fair value gaps: Confirming that price has tipped its hand and shown intent.
By combining these, breakers become a precise entry tool rather than a random block on the chart.
Final Thoughts
Breaker blocks simplify entries by using failed order blocks as confirmation of liquidity runs. With displacement and a fair value gap, they provide structure and clarity for executing trades. When layered with bias, points of interest, and stop hunts, they become one of the cleanest ways to enter the market.