VWAP
The Volume-Weighted Average Price
We consider it the most significant charting indicator.
What is it?
The volume-weighted average price (VWAP) is a trading benchmark used by traders that gives the average price a security has traded over a period of time, based on both volume and price.
Why is it significant?
When the price is trading above the VWAP, long position holders are profitable and unprofitable below.
It is that simple.
We will anchor the VWAP from any event that we consider significant, including the Year-to-Date, Month-to-Date, gaps, highs, lows, etc.
The CBOT, KCBTand MGEX wheat contracts are interesting to me as each is in a no-trade zone while the price is being pinched between significant VWAP levels.
Let us take a look and identify where we get bullish and bearish.
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