Making sense of VWAP in day trading
After watching a few YouTube videos, I started experimenting with VWAP in my intraday setups. It seems promising, but I still don’t get how to use it effectively. Some traders advise buying when the price is below the VWAP if there’s a strong uptrend, while others warn against this approach. I’d love to know how experienced traders interpret VWAP in various situations and whether it truly makes a difference compared to standard moving averages.
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VWAP reflects the true average price based on both price and volume, so it’s often used by institutions to assess fair value. If you want to master it, understanding how does vwap interact with other technical indicators is crucial. There’s a great breakdown here — https://forextester.com/blog/vwap/. Once you combine VWAP with something like Bollinger Bands or volume profile, you can spot key zones of accumulation or distribution. It helps you avoid bad entries and see where smart money is actually active.