A method of encoding an input video frame into an encoded video frame comprises the steps of disassembling the input video frame into a plurality of blocks of pixels. For each block being a current block, the method further comprises generating a corresponding predicted block from already reconstructed pixels, generating a residual block by subtracting the predicted block from the current block, generating a reconstructed block from the residual block and the predicted block, and generating the encoded video frame from the residual block The method further entails creating a local structure of reconstructed pixels in a region of the predicted block and aligning the predicted block with the local structure to produce an aligned predicted block, wherein the aligned predicted block is used in the steps of generating the residual block and generating the corresponding reconstructed block.