Mitigation Block Entry Strategy
What Is the Mitigation Block Entry Strategy?
The Mitigation Block Entry Strategy focuses on trading from areas where institutions previously entered the market and may revisit to mitigate their positions. These zones often act as hidden support or resistance and provide high-probability entries when price returns to them.
Rather than chasing price or reacting to noise, this strategy allows you to enter at levels where smart money is most likely still involved. When paired with price action confirmation, mitigation blocks become incredibly powerful zones to trade from.
Why the Mitigation Block Entry Strategy Works
When large players enter the market with size, they cannot always fill their entire position at once. So, they leave behind a partial footprint — a block of price action that often includes an unmitigated order. Later, price may return to that exact zone, not by accident, but to fill the rest of that institutional position.
This return to mitigate creates a second opportunity — one that often triggers a sharp reaction. By recognizing these blocks and waiting for confirmation, you gain the ability to trade with smart money rather than against it.
Tools and Conditions to Use
To trade this setup effectively, you’ll need clean charts, a solid grasp of structure, and the ability to remain patient. Here’s what to look for:
- A large impulsive move leaving behind a clean bullish or bearish candle
- A mitigation block near the origin of that move (usually the last opposite candle before the impulse)
- A return to that block with a reaction or rejection
- Confirmation through wick rejection, engulfing candle, or lower timeframe structure break
- Use 15-minute, 1-hour, or 4-hour timeframes for the clearest blocks
Once these conditions align, you’re ready to plan your entry.
Step-by-Step Guide to the Mitigation Block Entry Strategy
Step 1: Identify the Impulsive Move
Begin by spotting a strong move in the market.
- Look for an aggressive bullish or bearish push
- Price should move away from the zone quickly, leaving imbalance behind
- The origin of this move will often reveal where the institutional entry occurred
Mark this zone — this is where the mitigation block begins.
Step 2: Mark the Mitigation Block
Now that you’ve spotted the impulsive move, focus on the last candle in the opposite direction.
- For a bullish move, identify the last bearish candle before the rally
- For a bearish move, find the last bullish candle before the drop
- This candle (or its body and wick zone) becomes your mitigation block
This is where price may return to complete the unfilled order.
Step 3: Wait for Price to Return
Next, exercise patience and wait for price to revisit the block.
- Avoid entering just because price is nearby
- Let it fully tap into the zone or wick slightly through
- Watch carefully for signs of hesitation or rejection
You are waiting for the market to reveal its hand — not guessing.
Step 4: Look for Clear Rejection or Confirmation
Once price touches the block, it’s time to look for your entry signal.
- A wick rejection that closes within or just above/below the block
- An engulfing candle in the direction of the original impulse
- A lower timeframe break of structure for sniper-style entries
Only act when the confirmation is crystal clear.
Step 5: Enter the Trade
Now that your signal is confirmed, place your trade.
- Enter on the close of the confirmation candle
- You may also enter using a limit order inside the block for better risk-to-reward
- Ensure confluence with the higher timeframe bias
Precision and timing are everything in this strategy.
Step 6: Place a Thoughtful Stop Loss
Protecting your capital is just as important as entering well.
- For long trades, place your stop just below the mitigation block’s wick
- For short trades, place it just above the block
- Avoid placing stops too tight inside the block — give it space to work
Let the setup breathe while still managing your risk effectively.
Step 7: Set a Target That Aligns with Structure
With your trade running, plan your exit wisely.
- Use the next major swing high or low
- Aim for a minimum 1:2 or 1:3 risk-to-reward ratio
- Trail your stop if momentum picks up strongly
- Be aware of nearby imbalances or supply/demand zones
Your goal is consistency, not perfection — stick to your plan.
Risk Management Tips
- Never enter blindly on the first touch — wait for confirmation
- Don’t assume every impulse has a valid mitigation block
- Use smaller position sizes until you master identifying these zones
- Combine with other confluences like imbalance, trend, or liquidity for stronger setups
- Be strict about structure and candle confirmation
Disciplined execution is what makes this strategy powerful.
Common Mistakes to Avoid
- Entering without confirmation at the block
- Misidentifying the true origin of the move
- Placing stops inside the body of the mitigation block
- Chasing price instead of waiting for the retest
- Ignoring the larger trend or trading against it
Staying focused and rule-driven is the key to consistency.
Quick Reference Table
What Comes Next?
The Mitigation Block Entry Strategy gives you a smart way to trade from where institutions entered, not where retail traders react. By combining price memory with confirmation, you get one step closer to trading with precision and confidence.