Retro Game Challenge

I'm stuck at a room filled with colored blocks. You arrive from the left, and the exit is a ladder at the top left, and to the bottom right there's a small area you're able to visit earlier in the level but otherwise can't access from this side of the room, and a door to the bottom left that goes into one of those ambush rooms.

Can't seem to figure out how to get to the ladder. The FAQ seems to say that all you need to do is cut your way through the blocks till you make it to the exit. However there's a blue block on the top right that I cannot figure out a way to break that basically prevents me from getting up top to make it the rest of the way. Is there a way to slash upwards or something?

Could someone please explain to me how to get through this part?