The VWAP study, or Volume Weighted Average Price, represents the price weighted by volume and is very similar to moving averages.
The volume-weighted average price for a given timeframe is displayed using the Anchored VWAP study, which starts at a user-selected point.
This is an effective tool as it is displayed as a smooth line and accounts for the number of shares traded at each price level.
To use it, access the Studies menu:
Alternatively, use the Studies toolbar:
Apply the study to your chart window by left-clicking and holding on the starting candlestick, then release it. The VWAP line will then be plotted automatically.
Right-click on the study to access its Properties:
Under the Parameters tab, you can configure your desired input type, as shown above, using the following options:
High: Uses the highest price of the selected period.
Low: Uses the lowest price of the selected period.
Close: Uses the closing price of the selected period.
HL2: Average of the High and Low.
HLC3: Average of the High, Low, and Close.
OHLC4: Average of the Open, High, Low, and Close.
HLCC4: Weighted average that factors in the High, Low, and Close (counting Close twice).
Financial Average: Uses the traded financial volume as a reference, which is more common in traditional VWAP calculations.
Additionally, within the properties window, you can customize the appearance, position, and visibility of the study on the chart.
To learn more, watch the video below:
Was this content helpful?
Please rate us down below.