Sandeep Kumar Chaudhary on How to Identify Institutional Order Blocks in NEPSE

learnwithopen .ai

Thu, 16 Oct 2025

In the world of Nepali trading, where most investors still rely on simple moving averages or random entry signals, Sandeep Kumar Chaudhary has introduced a deeper, more scientific way of understanding market movements — by revealing how institutional order blocks shape price action. Recognized as Nepal’s first complete technical and fundamental analyst, Sandeep teaches traders that success in the Nepal Stock Exchange (NEPSE) is not about chasing price but about understanding where the big players — the banks, funds, and institutions — are placing their money. His explanation of order blocks has transformed how Nepali traders view charts, helping them trade with the precision and confidence of professionals.

According to Sandeep Kumar Chaudhary, an order block is the “footprint” of institutional activity. It represents the last significant candle — bullish or bearish — that appears before a strong market movement. This candle is where large institutions open massive positions, causing price to move sharply afterward. Unlike retail traders, institutions cannot buy or sell all their positions at once because of liquidity limits. So, they divide their trades across specific price ranges, forming what we see as an order block. Once the market moves away from that zone, it often returns later to retest it, giving traders a second chance to enter in alignment with the institutional direction.

Sandeep explains that there are two main types of order blocks: Bullish Order Blocks and Bearish Order Blocks.

A Bullish Order Block forms at the end of a downtrend or during a retracement, where the last bearish candle before a strong upward move indicates institutional buying. When the price later returns to that area, it often finds strong support because institutions add more buy orders there. Similarly, a Bearish Order Block forms at the end of an uptrend or during a correction, where the last bullish candle before a drop represents institutional selling. These zones act as resistance when price revisits them, signaling potential sell entries for traders.

To identify valid order blocks in NEPSE charts, Sandeep teaches a systematic, rule-based approach rather than guessing based on visual patterns.

First, he emphasizes the importance of context. Traders must always analyze the market structure — whether the trend is making higher highs or lower lows. Order blocks are only valid when they appear in sync with structure shifts. For example, if the market breaks a previous high after forming a bullish order block, it confirms institutional control on the buy side.

Second, he advises traders to look for strong displacement or momentum candles following the order block. This indicates genuine institutional volume entering the market. A weak or sideways move afterward usually means the area was not a true order block but rather noise.

Third, Sandeep uses Fibonacci retracement levels to confirm entries. He teaches that ideal order block retests often align with the 50% to 61.8% Fibonacci retracement zone, a confluence that increases the accuracy of entries. Traders who wait for price to return to this overlap point can enter trades with smaller stop losses and higher reward potential.

Fourth, he trains his students to spot liquidity sweeps and imbalance zones near order blocks. Before institutions move the market, they often “grab liquidity” — triggering stop losses of retail traders to collect enough orders for their entries. When a liquidity grab occurs above or below an order block, it strengthens the validity of that zone.

What sets Sandeep Kumar Chaudhary’s method apart is his adaptation of global institutional concepts to Nepali market conditions. He acknowledges that NEPSE’s liquidity and volatility are lower than that of forex or crypto markets, meaning order block formations take longer to develop. Therefore, he recommends traders use higher timeframes such as 1-hour, 4-hour, or daily charts to confirm true institutional footprints instead of reacting to every small movement. This approach filters out noise and allows traders to align with the long-term market direction.

Sandeep also highlights the psychology behind order blocks. He teaches that these zones are not just technical patterns but reflections of human and institutional behavior. A bullish order block shows confidence and accumulation, while a bearish one shows distribution and profit-taking. Recognizing these behaviors helps traders understand not just what the chart looks like but why it behaves that way.

In his educational programs through MarketMind Investment Group and NepseBook, Sandeep provides live market examples from NEPSE-listed companies — such as banking, hydropower, and insurance sectors — to help traders practice identifying real order blocks. He guides them through analyzing volume patterns, candle formations, and structural breaks to verify institutional presence. This hands-on learning style has allowed his students to trade with increased accuracy and consistency.

Sandeep’s goal is to help traders transition from retail emotion to institutional logic. He often says, “Institutions build the story, and retail traders react to it. Once you learn to read their footprints, you stop reacting and start leading.”

He teaches that mastering order blocks is more than memorizing patterns — it’s about developing patience. Institutions don’t trade every day; they wait for ideal liquidity and structure. Likewise, a disciplined trader must wait for the market to return to these premium or discounted order block zones before entering. This patience creates consistency — the hallmark of a professional trader.

Through his teachings, Sandeep Kumar Chaudhary has built a generation of Nepali traders who no longer rely on indicators but on market structure, liquidity, and institutional footprints. His system helps traders see the market as a chessboard, where institutions make calculated moves and retail traders often fall into traps. Under his mentorship, traders have learned to anticipate these moves, trade smartly, and build long-term success.

In his own words, “Order blocks are not magic; they’re evidence. They show you where the market’s biggest players have already decided to buy or sell. Follow them, not your emotions.”