Comments for https://ctrader.com/products/1452

Like all other indicators, if it's below you sell, if it's above you buy.

How VWAP Works
Calculation: It's the total value traded (Price x Volume) divided by the total volume over a specific period (usually intraday).
Representation: A single line on a price chart, with optional bands showing standard deviations.
Key Uses in Trading
Trend Identification: Price above VWAP suggests bullishness; below suggests bearishness.
Entry/Exit Points: Buy when price pulls back to VWAP (retest support) or sell when it rallies to it (retest resistance).
Fair Value: Helps identify if an asset is cheap (below VWAP) or expensive (above VWAP) for the day.
Institutional Benchmark: Used by large traders to gauge execution quality (e.g., getting a better average price than VWAP).
Limitations & Best Practices
Lagging: Based on past data, so it can be slow to react.
Intraday Focus: Standard VWAP resets daily, making it less useful for long-term analysis.
Context is Key: Use with other indicators (like RSI, MACD) for confirmation, as it doesn't predict future moves.