VWAP strategy for intraday trading means using the Volume Weighted Average Price to decide when to buy or sell during the same day. If the stock price is below the VWAP line, traders look to buy. If it's above the VWAP line, they look to sell. It helps traders follow the trend and avoid bad entry points.

What Is VWAP in Intraday Trading?

VWAP stands for Volume Weighted Average Price. It shows the average price of a stock throughout the day, based on both price and volume. Traders use VWAP to find the fair value of a stock and to understand if the current price is high or low compared to the average.

How Does VWAP Work for Intraday Trades?

VWAP helps traders know the right price levels for intraday buying or selling. If the price goes above VWAP with strong volume, it can signal a good time to buy. If the price falls below VWAP, it may be a time to sell or avoid buying. It gives a live benchmark for all your trades during the day.

What Is the Best VWAP Setup for Intraday?

The best VWAP setup is on 1-minute or 5-minute intraday charts. You add the VWAP indicator and wait for the price to touch or cross it. Look for volume confirmation and check if the market is trending or sideways. Avoid trading blindly—use candlestick patterns or support/resistance along with VWAP for better entries.

How Do You Trade with VWAP in Intraday?

To trade with VWAP, wait for the price to cross above VWAP with good volume—this may be a signal to buy. If the price drops below VWAP, it may be a time to sell or go short. You can also use VWAP as a trailing stop. Many traders use VWAP as dynamic support and resistance during market hours.

Can Beginners Use VWAP for Intraday?

Yes, beginners can easily use VWAP in intraday trading. It is simple to read and adds discipline to trading. Start by observing how price moves around the VWAP line. Practice in a demo account. Use it with volume and basic chart patterns for better understanding. Over time, you will get better at spotting high-probability trades.

Is VWAP Better Than Moving Averages in Intraday?

VWAP is often better for intraday trading because it also includes volume, not just price. Moving averages only show average price. VWAP gives a more accurate picture of real-time value. Many traders use both together—VWAP for short-term levels, and moving averages for the overall trend.