: Unlike traditional VWAP that resets daily, AVWAP calculates the cumulative volume-weighted average price from a user-selected starting point.
Used for short selling or cutting losses.
To understand Anchored VWAP, you must first understand standard VWAP. The traditional VWAP is a trading benchmark calculated as the cumulative sum of (price × volume) divided by the cumulative sum of volume. It represents the average price a security has traded at throughout a single trading session, weighted by volume.
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Many traders find the entry but fail to manage the trade. Here is the AVWAP-specific exit plan.
The book features over 140 full-color charts and case studies, moving beyond theory to provide a definitive framework for combining price, time, and volume. It offers detailed explanations of AVWAP techniques for day traders, swing traders, and investors alike. The strategies cover entry and exit for a wide range of scenarios, including:
: Download a dedicated anchored VWAP indicator from the MQL5 marketplace. The best tools allow you to drop up to five custom anchors directly on any candle, with each anchor calculating VWAP from that exact point forward. : Unlike traditional VWAP that resets daily, AVWAP
An advanced approach combines anchored VWAP with swing‑pattern slope confirmation to identify high‑probability uptrend breakouts. When both the AVWAP slope and price action confirm the trend direction, you have a robust setup with significantly improved odds.
: Enter a long position when the price touches the AVWAP line and displays a bullish reversal candlestick pattern (e.g., a hammer or bullish engulfing).
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: Instead of using an arbitrary percentage stop, trail your stop loss just behind the AVWAP line. If the price breaks cleanly through the AVWAP, the institutional thesis has failed, and you must exit.
Major news events often create lasting changes in market sentiment. Consider anchoring to: