Volume Weighted Average Price (VWAP)

VWAP is the price at which the average share has traded since the anchor, almost always today's open. Institutions use it as a benchmark for execution quality: buying below VWAP means a better price than the session's typical participant. On a chart it behaves like a magnet in a balanced session and like support or resistance in a trending session. It is not a moving average. Early in the session a few prints dominate it. Later it becomes heavy and moves slowly.

Price above a rising VWAP is a session uptrend in the simplest intraday filter. Price oscillating through a flat VWAP is a balanced session. Because the sum resets, yesterday's VWAP is a different object, a horizontal reference some traders keep, not the live line. Standard-deviation bands around VWAP show whether the current price is stretched relative to the volume-weighted distribution of this session, not relative to the last 20 days.

Holding above VWAP, and defending it on a retest, is the intraday bullish regime. A reclaim of VWAP after a morning below it can be a reversal of the session, if the reclaim holds. One tick above is not a regime.

Holding below VWAP is the intraday bearish regime. Failed bounces into VWAP are a common short location in a weak session. VWAP is not a target by itself. In a trend day price may never touch it after the open.

Using a daily-chart VWAP that secretly reset, or did not reset, differently from what you assume. Know the anchor. Also treating VWAP as a strategy. It is a benchmark. Fading every extension from it loses on trend days, which are the days the extension is the trade.

The typical-price shortcut is a bar approximation. A true VWAP is computed from prints. On a five-minute chart the two diverge. And VWAP has no memory of prior sessions unless you change the anchor, which is a different tool.