VWAP Scalping
Overview
VWAP (Volume Weighted Average Price) scalping uses the VWAP line and its standard deviation bands as dynamic support/resistance for intraday scalp entries. Institutional algorithms weight their execution toward VWAP, making it a self-fulfilling level. Price below VWAP = short bias; above = long bias.
Key Concepts
VWAP resets daily (session-specific), Standard deviation bands (1σ, 2σ, 3σ) act as dynamic S/R, Mean reversion: price tends to return to VWAP, Anchored VWAP from significant events for multi-day context, VWAP slope indicates intraday trend
Entry Signals
Long entries: price pulls back to rising VWAP, holding above with volume. Short entries: price rallies to falling VWAP, rejected below with volume. Fade moves to ±2σ bands back toward VWAP. Open drive away from VWAP: trail entries in trend direction.
Exit Signals
Mean reversion target: VWAP from the bands. Trend target: opposing band. Stop: beyond VWAP (or beyond the recent swing against you). Close all positions by session end — VWAP is an intraday indicator.
Best Timeframes
1M, 3M, 5M for entries with VWAP calculated on the session
Pro Tips
VWAP is most reliable in liquid instruments (ES, NQ, SPY, major forex pairs). On low-volume instruments, VWAP becomes less meaningful because fewer institutional algorithms are using it.
More Topics in This Category
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1-Minute Price Action Scalps
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