The volume-weighted average price (VWAP) is a technical analysis indicator used on intraday charts that resets at the start of every new trading session. It's a trading benchmark that represents the average price a security has traded at throughout the day, based on both volume and price.

What does the VWAP tell you?

The VWAP indicator shows the volume-weighted average market price of a particular stock. You can use the VWAP settings for day trading, as investors calculate the metric daily to understand the price fluctuations. Investors use the indicator to decide when to enter or exit the market.

How do you use a VWAP indicator?

When a security is trending, we can use VWAP and MVWAP to gain information from the market. If the price is above VWAP, it is a good intraday price to sell. If the price is below VWAP, it is a good intraday price to buy.