What Is VWAP? Volume Weighted Average Price Explained

The current market price tells you where an asset is trading right now.

VWAP answers a different question:

What has been the average price of the asset after giving greater importance to periods with higher trading volume?

VWAP stands for Volume Weighted Average Price.

It combines price and volume into one benchmark. Instead of treating every price observation equally, VWAP gives more influence to periods where more trading activity occurred.

That makes VWAP useful for understanding:

where substantial trading has taken place
whether the current price is above or below the volume-weighted average
intraday market behaviour
execution quality
how price is behaving relative to a widely watched benchmark

VWAP is especially popular among intraday traders and professional market participants.

But it is also one of the most misunderstood indicators.

A price above VWAP does not automatically mean buy.

A price below VWAP does not automatically mean sell.

VWAP is primarily a measurement and benchmarking tool.

It is not a machine for predicting the next market move.

What Does VWAP Stand For?

VWAP stands for:

Volume Weighted Average Price

Each part of the name explains the indicator.

Volume

The amount of an asset traded during a particular period.

Weighted

Periods with greater volume have greater influence on the final average.

Average Price

The resulting value represents a weighted average of prices during the chosen period.

In simple terms:

VWAP is an average price that gives greater importance to prices where more trading volume occurred.

That volume weighting is what separates VWAP from a normal price average.

What Is VWAP in Trading?

VWAP is a market benchmark calculated from both:

Price + Volume

Suppose an asset trades at three prices:

Price	Volume
₹100	100 units
₹102	500 units
₹104	1,000 units

A simple average treats all three prices equally.

Simple average:

₹100 + ₹102 + ₹104 = ₹306

₹306 ÷ 3 =

₹102

But considerably more trading occurred around ₹104.

VWAP accounts for this.

₹100 × 100 = ₹10,000

₹102 × 500 = ₹51,000

₹104 × 1,000 = ₹104,000

Total price-volume value:

₹165,000

Total volume:

1,600

VWAP:

₹165,000 ÷ 1,600 = ₹103.125

Therefore:

VWAP ≈ ₹103.13

The simple average was ₹102.

VWAP is approximately ₹103.13 because a much larger amount of trading occurred near ₹104.

This is the fundamental idea behind VWAP.

VWAP Formula

The simplified VWAP formula is:

VWAP = Σ (Price × Volume) ÷ Σ Volume

Where:

Price = price used for each period

Volume = volume traded during that period

Σ = sum of all selected periods

Many trading platforms use a representative price for each candle rather than simply using the closing price.

A commonly used value is:

Typical Price

Typical Price = (High + Low + Close) ÷ 3

Then:

VWAP = Σ (Typical Price × Volume) ÷ Σ Volume

This calculation continues throughout the chosen VWAP period.

How to Calculate VWAP Step by Step

VWAP may look complicated at first, but the calculation is straightforward.

Consider one trading candle.

Suppose:

High = ₹110

Low = ₹100

Close = ₹106

Volume = 2,000

First calculate Typical Price:

₹110 + ₹100 + ₹106 = ₹316

₹316 ÷ 3 =

₹105.33

Now multiply by volume:

₹105.33 × 2,000 = ₹210,660

The same calculation is performed for subsequent periods.

Then:

Add all price × volume values.
Add all the volume.
Divide cumulative price-volume by cumulative volume.

The resulting figure is VWAP.

How Does the VWAP Indicator Work?

VWAP usually appears as a line moving across a trading chart.

As each new candle forms, the calculation incorporates:

price
volume

VWAP then updates.

Unlike many traditional moving averages, standard intraday VWAP usually starts from a defined point such as the beginning of the trading session.

As more trading occurs, VWAP becomes increasingly influenced by all the trading activity accumulated since that starting point.

Why Volume Matters

Imagine two trades.

One takes place at ₹100 for only 10 units.

Another takes place at ₹105 for 100,000 units.

Should both prices have equal importance when estimating the average trading price?

Probably not.

The ₹105 price represents far more market activity.

VWAP reflects this difference.

That is why it can provide more useful context than a simple average when trading volume varies substantially.

What Does Price Above VWAP Mean?

If an asset is trading above VWAP, its current price is above its calculated volume-weighted average for the chosen period.

For example:

VWAP = ₹100

Current price = ₹104

The asset is trading:

₹4 above VWAP

Some traders interpret sustained price above VWAP as relative intraday strength.

However, this does not mean the price must continue rising.

Price can move above VWAP because of:

genuine buying pressure
temporary momentum
news
low liquidity
short covering
volatility
speculative activity

Therefore:

Above VWAP does not automatically mean bullish forever or guarantee a profitable buy.

It simply describes the current relationship between price and VWAP.

What Does Price Below VWAP Mean?

If the current market price is below VWAP, the asset is trading below its calculated volume-weighted average.

Example:

VWAP = ₹100

Current price = ₹96

Current price is:

₹4 below VWAP

Some traders interpret sustained price below VWAP as relative intraday weakness.

But again:

Price below VWAP is not automatically a sell signal.

Temporary declines can occur before price recovers.

VWAP provides market context rather than certainty.

Is VWAP Bullish or Bearish?

VWAP itself is neither bullish nor bearish.

It is simply a calculated benchmark.

Traders sometimes interpret:

Price consistently above VWAP

as relative strength.

And:

Price consistently below VWAP

as a relative weakness.

But the surrounding market structure matters.

For example, price may cross VWAP many times during a sideways session.

In that situation, VWAP may provide very little directional information.

Why Do Traders Use VWAP?

VWAP has several practical applications.

1. Measuring the Average Trading Level

VWAP helps traders understand where the market has traded on a volume-weighted basis.

2. Comparing Current Price With Average Activity

Traders can quickly see whether current price is:

above VWAP
below VWAP
close to VWAP

This provides intraday context.

3. Evaluating Trade Execution

VWAP is commonly used as a benchmark for determining whether a large trade achieved a relatively favourable execution price.

For example, suppose an institution buys shares throughout the day.

Its average purchase price is:

₹99.40

The day’s VWAP is:

₹100

The execution price was below the day’s VWAP.

That may indicate relatively favourable execution compared with the broader volume-weighted market price.

4. Observing Intraday Trend Behaviour

Traders may monitor whether price remains predominantly above or below VWAP.

5. Identifying Widely Watched Market Areas

Because many traders and institutions monitor VWAP, price interaction around VWAP can attract attention.

This does not guarantee that VWAP becomes support or resistance.

Why Institutional Traders Use VWAP

VWAP is important in professional trading because large orders can influence market prices.

Imagine a fund wants to purchase 5 million shares.

Buying all 5 million immediately could push the price higher.

Instead, the fund may divide its order into many smaller trades.

After the trading period ends, the institution can compare its average purchase price with VWAP.

This helps evaluate execution quality.

VWAP can therefore serve as a benchmark rather than simply as a chart signal.

This institutional use is one of the reasons VWAP remains an important market metric.

Is VWAP a Leading or Lagging Indicator?

VWAP is primarily a lagging or descriptive indicator.

It is based on trading that has already happened.

It uses:

previous prices
previous volume

Therefore it cannot know:

tomorrow’s news
the next major order
future sentiment
unexpected economic announcements
liquidations
regulatory announcements
future supply and demand

However, calling VWAP lagging does not mean it is useless.

Its purpose is not to predict the future.

Its primary purpose is to describe where meaningful market activity has occurred.

How Accurate Is VWAP?

This is one of the most misunderstood questions about VWAP.

VWAP can accurately calculate a volume-weighted average price according to the data and settings supplied.

However:

Accurate calculation does not mean accurate market prediction.

VWAP may correctly show the average volume-weighted price while still failing to predict whether the market will rise or fall.

Therefore VWAP cannot guarantee that:

price will bounce from VWAP
price will reverse after crossing VWAP
price above VWAP will continue rising
price below VWAP will continue falling

The best way to understand VWAP accuracy is:

VWAP accurately measures what has happened. It does not guarantee what will happen next.

Is VWAP a Buy or Sell Indicator?

VWAP should generally not be treated as a standalone buy-or-sell system.

One of the most common mistakes is believing:

Price above VWAP = Buy

and

Price below VWAP = Sell

Markets are far more complex.

A trader may combine VWAP with:

market structure
support and resistance
price action
volatility
momentum
volume analysis
trend analysis
liquidity
broader market conditions
risk management

VWAP provides information.

It does not eliminate trading risk.

VWAP vs Simple Moving Average

VWAP and a Simple Moving Average may look similar on charts, but their calculations are very different.

Feature	VWAP	SMA
Uses price	Yes	Yes
Uses volume	Yes	No
Volume affects weighting	Yes	No
Common intraday use	Yes	Yes
Usually anchored/reset	Yes	No
Purpose	Volume-weighted benchmark	Smooth price movement

A Simple Moving Average gives every selected price equal importance.

VWAP gives greater influence to periods with greater volume.

VWAP vs EMA

EMA stands for Exponential Moving Average.

An EMA gives greater weight to more recent prices.

VWAP instead gives greater importance based on trading volume.

Their purposes therefore differ.

EMA asks:

What is the recent direction of average price?

VWAP asks:

What is the average price after accounting for trading volume?

Neither indicator is universally better.

They measure different aspects of market behaviour.

VWAP vs VWMA

VWAP and VWMA are often confused.

They are not the same.

VWAP

Volume Weighted Average Price

Usually calculates a cumulative volume-weighted price from a defined anchor or session.

VWMA

Volume Weighted Moving Average

Calculates a rolling volume-weighted average across a chosen number of periods.

For example:

A 20-period VWMA constantly moves forward using the latest 20 periods.

VWAP may instead continue accumulating data from the beginning of the trading session.

A simple distinction is:

VWAP is commonly anchor-based.

VWMA is commonly rolling-period based.

VWAP vs Moving Average: Simple Example

Imagine three trading candles.

Candle	Price	Volume
1	₹100	1,000
2	₹101	1,000
3	₹110	100,000

A simple moving average treats all three prices equally.

But VWAP gives enormous influence to the third candle because its trading volume is dramatically higher.

This explains why VWAP can move differently from ordinary moving averages.

What Is Anchored VWAP?

Anchored VWAP, often abbreviated as AVWAP, calculates VWAP starting from a specific point selected by the trader.

Instead of automatically beginning from the start of a trading session, Anchored VWAP might begin from:

an important market low
a major market high
an earnings announcement
a breakout
a crash
a major news event
a listing date
a significant support level

This allows traders to answer questions such as:

What has been the volume-weighted average price since this major market event?

Anchored VWAP expands the concept beyond a normal daily trading session.

Session VWAP vs Anchored VWAP

Feature	Session VWAP	Anchored VWAP
Start point	Trading session	User-selected event
Typical use	Intraday	Event-based analysis
Reset	Usually new session	Depends on anchor
Main question	Average price today	Average price since event

Both use volume weighting.

The main difference is where the calculation begins.

Does VWAP Reset Every Day?

Traditional session VWAP commonly resets when a new trading session begins.

However, modern VWAP implementations can use different anchors.

Examples include:

session
week
month
quarter
year
custom point
event date

Therefore:

Session VWAP often resets daily, but VWAP does not inherently have to reset every day.

Always check the chart settings before interpreting the indicator.

What Is VWAP in Stocks?

VWAP is particularly popular in stock trading.

Stock exchanges generally have clearly defined trading sessions.

This provides a natural beginning and end for session-based VWAP calculations.

Stock traders may use VWAP to evaluate:

intraday market direction
price relative to average trading activity
execution quality
market participation
potential reference levels

Institutional participants may also use VWAP as a benchmark when executing large orders.

What Is VWAP in Crypto?

VWAP can also be used in cryptocurrency markets.

The basic concept remains the same:

Volume Weighted Average Price

However, cryptocurrency creates several complications.

Unlike traditional stock exchanges, cryptocurrency markets:

operate 24 hours a day
operate seven days a week
trade across many exchanges
use different trading pairs
have fragmented liquidity
can have different volume data on different platforms

Therefore crypto VWAP can depend on:

exchange
trading pair
data provider
session definition
reset time
chart settings

For example:

BTC/USDT volume on one exchange may differ significantly from BTC/USD volume on another.

As a result, VWAP values can differ slightly across platforms.

Why VWAP Can Differ Between Exchanges

This is particularly important in cryptocurrency.

Imagine:

Exchange A processes:

₹1 billion equivalent of Bitcoin volume

while Exchange B processes:

₹100 million

The order flow and prices may differ.

Because VWAP depends directly on both price and volume, each exchange may calculate a different VWAP.

Therefore traders should understand where their chart data comes from.

What Is VWAP in Bitcoin Trading?

Bitcoin traders may use VWAP to understand where BTC has traded on a volume-weighted basis.

A Bitcoin trader might monitor:

current BTC price vs VWAP
distance from VWAP
interaction around VWAP
Anchored VWAP from major highs
Anchored VWAP from market lows

However, Bitcoin’s fragmented global trading environment means VWAP should always be interpreted in the context of the underlying exchange and trading pair.

Can VWAP Work as Support and Resistance?

Sometimes.

Because many traders monitor VWAP, price may react around the VWAP line.

For example:

During an uptrend, traders may watch whether a pullback toward VWAP attracts buying.

During a downtrend, traders may watch whether a rally toward VWAP encounters selling.

However:

VWAP is not guaranteed support or resistance.

Price can:

cross through VWAP
remain around VWAP
repeatedly move above and below VWAP

It is more accurate to describe VWAP as a:

widely watched reference area

rather than guaranteed support or resistance.

Why Does Price Cross VWAP?

A crossover occurs when current price moves from one side of VWAP to the other.

This can happen frequently.

In a strong uptrend:

Price may stay mostly above VWAP.

In a strong downtrend:

Price may stay mostly below VWAP.

In a sideways market:

Price may cross VWAP repeatedly.

Repeated crossings can create misleading trading signals.

VWAP Trading Approaches

VWAP can be incorporated into many analytical approaches.

None should be treated as guaranteed strategies.

1. VWAP Trend Approach

A trader observes whether price remains primarily:

above VWAP

below VWAP

Persistent price above VWAP may accompany intraday strength.

Persistent price below VWAP may accompany weakness.

The important word is:

may

VWAP alone does not establish the trend.

2. VWAP Pullback Approach

During a strong trend, price may move far away from VWAP.

It may later return toward the VWAP line.

Some traders watch the reaction near VWAP to determine whether the trend may continue.

However, price can also break directly through VWAP.

3. VWAP Mean-Reversion Approach

Some traders believe extremely large deviations from VWAP may eventually move back toward the average.

This is called mean reversion.

However, strongly trending markets can remain far above or below VWAP for surprisingly long periods.

Therefore:

Distance from VWAP alone does not guarantee a reversal.

4. VWAP Breakout Approach

Some traders monitor situations where price moves from one side of VWAP to the other with strong momentum and volume.

However, VWAP crossovers can produce false signals.

Confirmation from broader market structure is important.

5. VWAP Execution Benchmark

This is one of VWAP’s most practical uses.

A trader or institution compares the average execution price of an order with VWAP.

Suppose:

Average purchase price:

₹995

VWAP:

₹1,000

The trader purchased below VWAP.

This may indicate relatively favourable execution compared with the selected VWAP benchmark.

VWAP and Market Trends

VWAP behaves differently depending on market conditions.

Strong Uptrend

Price may remain above VWAP for much of the session.

Strong Downtrend

Price may remain below VWAP.

Sideways Market

Price may cross VWAP repeatedly.

Highly Volatile Market

Price may move significantly away from VWAP before rapidly returning.

Understanding the market environment matters more than interpreting every VWAP crossover mechanically.

How Far Can Price Move From VWAP?

There is no fixed maximum distance.

Price can move significantly away from VWAP during:

strong trends
breaking news
market crashes
short squeezes
liquidation events
low liquidity
major economic releases

A large distance from VWAP does not automatically mean price must return immediately.

VWAP Bands

Some charting platforms allow traders to add bands around VWAP.

These may be based on:

standard deviation
percentage distance
other statistical measurements

VWAP bands help visualise how far price has moved from the central VWAP line.

They may be useful for evaluating:

volatility
unusually large deviations
potential mean-reversion areas

But VWAP bands also do not guarantee reversals.

What Are VWAP Standard Deviation Bands?

Standard deviation measures how widely prices are dispersed around an average.

When standard-deviation bands are placed around VWAP, traders can see whether price is:

close to VWAP
moderately extended
unusually far from VWAP

An asset reaching an outer VWAP band does not automatically mean it is overbought or oversold.

Strong trends can remain extended for long periods.

VWAP in Day Trading

VWAP is especially popular among day traders because it provides a continuously updated intraday benchmark.

Day traders may monitor:

opening price relative to VWAP
price crosses
pullbacks
distance from VWAP
volume around VWAP
intraday trend

However, VWAP should not replace:

position sizing
stop-loss planning
market analysis
risk management

VWAP in Swing Trading

Traditional session VWAP is generally more relevant to intraday analysis than multi-day swing trading.

Swing traders may instead find greater use in:

Anchored VWAP
weekly VWAP
monthly VWAP

These longer anchors can provide context across multiple trading sessions.

VWAP for Long-Term Investors

VWAP is generally not a primary fundamental-investment metric.

Long-term investors usually focus more heavily on factors such as:

business quality
valuation
cash flow
competitive position
earnings
industry conditions

However, VWAP may still be useful when executing a large purchase or sale.

VWAP and Liquidity

VWAP depends heavily on volume.

Therefore liquidity matters.

In highly liquid assets, volume data may provide a meaningful representation of trading activity.

In illiquid markets:

a few large trades can distort the calculation
spreads can be wider
price jumps can be larger
VWAP may become less representative

This is especially important when trading small-cap stocks or thinly traded cryptocurrency pairs.

VWAP and Market Open

The market open can have unusually high volume and volatility.

Because VWAP is volume weighted, heavy early-session trading can significantly influence the day’s VWAP.

Later trading then builds on that early data.

This helps explain why VWAP can become less responsive later in the session.

Why VWAP Becomes Slower Later in the Session

Imagine VWAP has already accumulated:

10 million shares of volume

A new candle contains only:

10,000 shares

That candle represents a very small percentage of cumulative volume.

Therefore it has relatively little influence on the final VWAP value.

This is why session VWAP often becomes progressively less responsive as the session develops.

Advantages of VWAP

VWAP has several strengths.

Combines price and volume

This provides more information than price alone.

Easy to understand visually

Traders can quickly compare current price with VWAP.

Useful benchmark

VWAP is widely used for evaluating trade execution.

Useful intraday context

It can help reveal whether price is trading above or below the volume-weighted average.

Widely followed

Because many market participants monitor VWAP, it can become a meaningful reference level.

Disadvantages of VWAP

VWAP also has important limitations.

It is backward-looking

VWAP uses historical price and volume.

It can lag

The cumulative calculation becomes slower to respond as more data accumulates.

It cannot predict unexpected events

VWAP cannot foresee:

breaking news
economic announcements
regulatory action
sudden liquidations

It depends on data quality

Poor volume data reduces usefulness.

It can create false crossover signals

Sideways markets may repeatedly cross VWAP.

Different platforms may show different values

Differences in price source, exchange data or anchor settings can change the calculation.

Common VWAP Mistakes

Understanding incorrect VWAP use is extremely important.

Mistake 1: Treating VWAP as a guaranteed buy signal

Above VWAP does not guarantee price appreciation.

Mistake 2: Treating VWAP as a guaranteed sell signal

Below VWAP does not guarantee further declines.

Mistake 3: Trading every crossover

VWAP can be crossed repeatedly in sideways markets.

Mistake 4: Assuming VWAP predicts the future

VWAP describes previous and current market activity.

Mistake 5: Ignoring volume quality

VWAP is only as useful as the data used to calculate it.

Mistake 6: Ignoring the VWAP anchor

Daily VWAP and Anchored VWAP can produce very different values.

Mistake 7: Confusing VWAP with VWMA

They are separate indicators.

Mistake 8: Assuming below VWAP means undervalued

VWAP does not measure fundamental valuation.

Mistake 9: Assuming above VWAP means overvalued

A strongly trending asset can remain above VWAP for extended periods.

Mistake 10: Ignoring the overall market

VWAP should not be interpreted in isolation.

Is VWAP Good for Beginners?

Yes, provided beginners understand its actual purpose.

A beginner should remember two rules.

Rule 1

VWAP shows a volume-weighted average price.

Rule 2

VWAP does not predict the future.

Understanding these two ideas prevents many common mistakes.

When Is VWAP Most Useful?

VWAP is especially useful when you want to understand:

average price weighted by volume
intraday market activity
execution quality
current price relative to average trading activity
potential market reference levels
behaviour around an important event when using Anchored VWAP

When Is VWAP Less Useful?

VWAP may be less useful when:

volume data is unreliable
liquidity is extremely low
the market is highly fragmented
the trader expects it to predict future direction
VWAP is used without considering broader market conditions

VWAP Frequently Asked Questions

What is VWAP?

VWAP stands for Volume Weighted Average Price. It measures average price while giving greater importance to periods with higher trading volume.

What does VWAP stand for?

VWAP stands for:

Volume Weighted Average Price.

What does VWAP mean in trading?

VWAP is a benchmark that shows the average price of an asset weighted according to trading volume.

What is a VWAP indicator?

A VWAP indicator plots Volume Weighted Average Price on a chart so traders can compare current price with the volume-weighted average.

What is the VWAP formula?

The simplified formula is:

VWAP = Σ (Price × Volume) ÷ Σ Volume

Does VWAP use volume?

Yes.

Volume is a fundamental part of the calculation.

What is VWAP in stocks?

VWAP in stocks measures the volume-weighted average trading price over a selected period, commonly an intraday session.

What is VWAP in crypto?

VWAP in cryptocurrency applies the same concept, although calculations can differ between exchanges because crypto volume is spread across multiple trading venues.

Is VWAP accurate?

VWAP can accurately measure a volume-weighted average based on the selected data.

It does not accurately predict future prices with certainty.

Is VWAP a good indicator?

VWAP can be useful for market context and trade-execution benchmarking.

It should not be treated as a guaranteed trading signal.

Is VWAP bullish?

VWAP itself is neither bullish nor bearish.

Price above VWAP may indicate relative strength, while price below VWAP may indicate relative weakness, depending on market context.

Is VWAP a buy signal?

No.

Price crossing above VWAP alone does not guarantee a profitable trade.

Is VWAP a sell signal?

No.

Price falling below VWAP alone does not guarantee further price declines.

Is VWAP better than EMA?

Neither is universally better.

EMA gives greater weight to recent prices.

VWAP gives greater weight to periods with higher trading volume.

Is VWAP better than SMA?

They serve different purposes.

SMA measures an equally weighted average of prices.

VWAP incorporates trading volume.

What is VWAP vs VWMA?

VWAP generally calculates cumulative volume-weighted price from an anchor.

VWMA calculates a rolling volume-weighted moving average across a chosen number of periods.

Does VWAP reset daily?

Session VWAP typically resets when a new trading session begins.

Other VWAP configurations may reset weekly, monthly, yearly or from a custom anchor.

What is Anchored VWAP?

Anchored VWAP calculates Volume Weighted Average Price starting from a specific point selected by the user.

Can VWAP be used for Bitcoin?

Yes.

However, Bitcoin trades across many exchanges, so VWAP can vary depending on exchange, trading pair and volume data.

Can VWAP act as support?

Sometimes traders observe reactions around VWAP, but it is not guaranteed support.

Can VWAP act as resistance?

It can sometimes behave as a reference resistance area, but price can also move directly through it.

Why is VWAP important?

VWAP combines price and volume and provides a widely followed benchmark for understanding trading activity and evaluating executions.

Is VWAP good for day trading?

VWAP is commonly used in intraday analysis, but it should be combined with market context and risk management rather than being used alone.

Can VWAP predict price?

No indicator can reliably predict every future market movement.

VWAP primarily describes where trading has occurred.

VWAP Quick Reference

Question	Answer
Full form	Volume Weighted Average Price
Uses price?	Yes
Uses volume?	Yes
Main use	Intraday benchmark
Predictive?	No
Common in stocks?	Yes
Can be used in crypto?	Yes
Commonly resets?	Each session
Anchored version available?	Yes
Same as VWMA?	No
Same as EMA?	No
Automatic buy/sell signal?	No

Final Takeaway

VWAP is valuable because it combines two of the most important pieces of market information:

Price

and

Volume

Instead of asking only:

What is the asset trading for right now?

VWAP asks:

What has the average price been after accounting for where the most trading volume occurred?

That distinction makes VWAP useful for:

understanding intraday trading activity
measuring price relative to average market participation
evaluating trade execution
observing trends
analysing reactions around widely followed reference levels
studying market behaviour from important events using Anchored VWAP

But VWAP has limits.

It cannot predict future news.

It cannot guarantee reversals.

It cannot guarantee breakouts.

It cannot tell you with certainty whether an asset should be bought or sold.

The most useful way to treat VWAP is therefore:

VWAP is a benchmark for understanding price and volume, not a promise about what the market will do next.

For traders who understand that distinction, VWAP can be one of the clearest tools for interpreting intraday market activity.