VWAP (Volume Weighted Average Price) is a trading indicator that shows the average price of an asset weighted by volume, helping traders identify market trends and potential entry/exit points.
Use VWAP as a dynamic support/resistance level. When price is above VWAP, it may indicate bullish momentum, while prices below VWAP could suggest bearish conditions. Combine with other indicators for confirmation.
Professionals use VWAP because it reflects true market activity by incorporating both price and volume data, making it more reliable than simple moving averages for identifying institutional trading activity.
