VWAP: The Intraday Indicator Every Trader Should Know

When it comes to intraday trading, precision matters. That’s where VWAP—the Volume Weighted Average Price comes in.

Used by retail traders, institutional players, and algo systems alike, VWAP helps you understand the average price of a security throughout the day, weighted by volume. It's one of the most important indicators for intraday decision-making on platforms like TradingView.

What is VWAP?

VWAP is the average price a security has traded at throughout the day, based not just on price but also on volume. It gives more importance to price levels with higher volume, making it a reliable benchmark for assessing price fairness and trend direction.

Why VWAP Matters

• Intraday Trend Gauge: Traders use VWAP to identify whether the price is trading above or below its average.
  
  
• Support & Resistance: VWAP often acts as dynamic support or resistance during the trading day.
  
  
• Institutional Benchmark: Many institutional traders use VWAP to ensure they’re getting good execution on large orders.
  

How to Use VWAP in Your Trading

• Above VWAP: Bullish bias. Consider long trades when price holds above VWAP.
  
  
• Below VWAP: Bearish bias. Look for short setups when price stays below VWAP.
  
  
• Pullback Entries: Traders often use VWAP for entries on pullbacks during a trending day.
  

VWAP on TradingView

To use VWAP on TradingView:

• Open any intraday chart.
  
  
• Search for the VWAP indicator in the Indicators tab.
  
  
• Apply it to your chart—no custom settings needed for the basic version.
  

You can also experiment with anchored VWAPs or custom scripts that fit your strategy better.

Conclusion

VWAP is more than just a line it’s a real-time gauge of value and trend. It helps traders stay on the right side of momentum while managing entries and exits more effectively.

Whether you’re scalping or holding intraday positions, understanding VWAP can add a powerful edge to your trading setup.