Volume-Weighted Average Price (VWAP) Strategy for Crypto Trading
A simple yet powerful trick to improve your entries and exits is using the VWAP (Volume-Weighted Average Price).
It gives you the average price weighted by volume, making it a reliable indicator to spot trend direction and trade with institutional players.
How to use VWAP in trading:
Trend Confirmation:
If the price is above VWAP, the market is bullish—favors buying.
If the price is below VWAP, the market is bearish—favors selling.
Entry Points:
In an uptrend, wait for a pullback to VWAP and enter long once the price bounces off it.
In a downtrend, wait for a retest of VWAP and enter short when it rejects.
Exit Points:
Use VWAP as a trailing stop loss. If you're long, exit if the price crosses below VWAP.
If you're short, exit if the price crosses above VWAP.
VWAP is perfect for intraday trading and helps you trade with the big players while filtering out noise.
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