Video coding representing the moving region in Macroblock by pattern templates has already established its superiority over H.264 in low bit rate areas. In this approach, moving region covered by best matched pattern template is used to estimate the motion and encode the corresponding residual error. Due to the occlusion sometimes motion estimation of moving region using pattern template cannot reflect the true object movement. Moreover, uncovered moving region by pattern template may generate the wrong motion information. In this paper, we propose a novel pattern based residual coding covered by best matched template using full block motion vector instead of pattern covered moving region. Thus, unlike the present approach, it can avoid wrong motion vector due to the occlusion. Since this approach uses large block (16?16) motion estimation information, no computational overhead is needed compared to the H.264 video coding standard. The experimental results confirm that this new approach successfully reduces the bits stream significantly and as a result improves the rate-distortion performance compared to the existing pattern-based video coding as well as H.264 standard.