VWAPs: How to sharpen your edge
a thread🧵
a thread🧵
In the following thread I will cover:
1. What's Vwap?
2. Different kinds of Vwaps
3. AMT (Auction market theory)
4. Examples
5. How to sharpen your edge using Vwap?
6. Conclusion
1. What's Vwap?
2. Different kinds of Vwaps
3. AMT (Auction market theory)
4. Examples
5. How to sharpen your edge using Vwap?
6. Conclusion
1. What’s Vwap?:
Vwap stands for "volume weighted average price" and is commonly referred to as an indicator for fair price that many markets tend to respect. Vwaps are used by numerous succesful traders, it is calculated by the following formula:
Vwap stands for "volume weighted average price" and is commonly referred to as an indicator for fair price that many markets tend to respect. Vwaps are used by numerous succesful traders, it is calculated by the following formula:
2. Different kinds of Vwap:
The anchored Vwap- commonly anchored to swing
lows/highs, can indicate current momentum
Rolling Vwaps- their value is calculated based on a
fixed period of time, i.e every 30 days.
The anchored Vwap- commonly anchored to swing
lows/highs, can indicate current momentum
Rolling Vwaps- their value is calculated based on a
fixed period of time, i.e every 30 days.
2. Different kinds of Vwaps:
The time based Vwap (my favorite one) -
Time based Vwaps are calculated from the beginning of i.e. your first day of the week/month/quarter/etc. till the end of the week/month/....
The time based Vwap (my favorite one) -
Time based Vwaps are calculated from the beginning of i.e. your first day of the week/month/quarter/etc. till the end of the week/month/....
3. AMT
a brief overview:
Markets are in a constant auction trying to fullfill its' purpose of fascilitating a trade. Participants always seek fair value and reject "unfair" value (Deviations). Moreover markets tend to be rotational within Value.
#What_is_Auction_Market_Theory" target="_blank" rel="noopener" onclick="event.stopPropagation()">tradingriot.com
a brief overview:
Markets are in a constant auction trying to fullfill its' purpose of fascilitating a trade. Participants always seek fair value and reject "unfair" value (Deviations). Moreover markets tend to be rotational within Value.
#What_is_Auction_Market_Theory" target="_blank" rel="noopener" onclick="event.stopPropagation()">tradingriot.com
4. Some examples:
The following examples show a time based Vwap and the first standard deviations (VAH/VAL).
I personally prefer to use previous value as the levels are fixed and usually tend to be more respected.
The following examples show a time based Vwap and the first standard deviations (VAH/VAL).
I personally prefer to use previous value as the levels are fixed and usually tend to be more respected.
5. How to sharpen your edge using Vwap?
I personally like to use time based Vwaps and previous Values. Vwaps provide me with a Bias/direction and a level that I would like to trade around. My process on every Daily Outlook is the same: htf Vwaps (y/q/m) → ltf Vwaps(w/d)
I personally like to use time based Vwaps and previous Values. Vwaps provide me with a Bias/direction and a level that I would like to trade around. My process on every Daily Outlook is the same: htf Vwaps (y/q/m) → ltf Vwaps(w/d)
6. Conclusion
Vwap based levels offer great levels to trade around. However, they are not a stand alone strategy for me. There is much more to the topic, if you want to learn more about this style of trading I strongly recommend checking out @C2MCrypto
cheers and have a good one
Vwap based levels offer great levels to trade around. However, they are not a stand alone strategy for me. There is much more to the topic, if you want to learn more about this style of trading I strongly recommend checking out @C2MCrypto
cheers and have a good one
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