Volume-Weighted Average Price, a trading benchmark calculated by dividing the total dollar value of all trades by the total volume traded over a given period, typically one intraday session. VWAP represents the average price at which a security has traded throughout the day weighted by volume, making it a widely used reference for institutional execution quality. Intraday traders use VWAP as dynamic support and resistance, with price above VWAP considered bullish and price below considered bearish.
Example
“The stock reclaimed VWAP at $127.50 midday on strong buying, and the trader went long using VWAP as a trailing stop reference for the remainder of the session.”