VWAP — what it is and how to use it in trading
Definition
VWAP (Volume-Weighted Average Price) is the average traded price over the period, weighted by volume — bars with more volume influence the value more than low-volume bars.
How it works in the builder
The vwap operand takes a period parameter (default 14) — the window over which the volume-weighted average is computed.
What it looks like on the chart
Drawn directly on the price chart as a single line, similar to a moving average, but reacting to volume rather than only the closing price.
Typical use
Institutional traders often use it as an intraday "fair price" reference. Typical condition: close > vwap(14) as a filter to "only buy above the volume-weighted average price".
Common pitfalls
VWAP is historically calculated over a single trading session (resetting at its start) on exchange markets — in the builder it's a rolling window of period bars instead, which suits 24/7 crypto markets, but it's worth remembering this differs from the classic intraday VWAP.
This block is available in the strategy builder
137 no-code blocks — build an entry condition with this term and test it on history
Historical results do not guarantee future ones. The service is an informational and analytical tool, not an individual investment recommendation; trades are not executed.