What is the Volume Weighted Average Price (VWAP) indicator?

by london_lueilwitz , in category: Stocks and Equities , 4 months ago

What is the Volume Weighted Average Price (VWAP) indicator?

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1 answer

by vincenzo.murazik , 4 months ago


The Volume Weighted Average Price (VWAP) indicator is a technical analysis tool used by traders and investors to determine the average price at which a security has been traded over a specific time period, taking into account the trading volume during each price level. It is calculated by multiplying the price of each trade by the corresponding trading volume and then summing up these values. The VWAP indicator is often used by institutional traders to gauge the true average price of a security and identify potential trend reversals or support/resistance levels. It is displayed as a continuous line on a price chart and is commonly used in intraday trading strategies.