Indicators · Intermediate

VWAP: Volume Weighted Average Price

A 1-minute lesson from the MarketPro academy, one of 22 in trading indicators.

Last reviewed 15 September 2026 by the MarketPro research desk · Editorial policy

Short answer

VWAP (volume weighted average price) calculates the average price a market has traded at over a session, weighted by how much volume traded at each price — giving a sense of the "fair" average price paid so far rather than a simple average of price alone. VWAP typically resets at the start of each new session and builds up throughout the day.

How VWAP Is Used

VWAP typically resets at the start of each new session and builds up throughout the day. Price trading above VWAP is often read as a sign that buyers are, on average, paying a premium relative to the session's volume-weighted average; price below VWAP suggests the opposite. Some traders treat VWAP itself as a dynamic support/resistance line, watching for price to react around it during pullbacks.

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VWAP was originally developed as a benchmark for institutional execution quality — comparing whether a large order was filled better or worse than the session average — before becoming widely used as a general chart indicator
Because it resets each session, VWAP is most relevant for intraday analysis and loses meaning on longer swing or position-trading timeframes
Like any average, VWAP lags in fast-moving conditions and can be quickly left behind during a strong directional session

VWAP works well as one layer of intraday context, particularly when combined with volume and price action, but a single touch of the VWAP line is not a reliable standalone signal on its own.

Lesson 12 of 22 in Trading indicators

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Written and reviewed by the MarketPro research desk

MarketPro is a trading-signal and trading-education app operated by Harajuku Holdings LTD (Cyprus). Our signal desk publishes and tracks every trade idea in-app, and every page here is checked against the app's live behaviour before publishing. Last reviewed 15 September 2026. How we produce signals and content · About MarketPro

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