Volume Weighted Average Price (VWAP)

VWAP, or Volume Weighted Average Price, is the average price at which a security has traded throughout a session, weighted by the volume executed at each price level. It is calculated by dividing the cumulative value of all trades (price × volume) by the total volume for the day, and resets at the start of each new session. VWAP serves as a benchmark for institutional traders — buying below VWAP is considered an efficient execution; selling above VWAP is considered favourable. It also acts as a key intraday support and resistance level — price consistently above VWAP is interpreted as bullish intraday momentum; below VWAP is bearish. VWAP is the standard execution benchmark for large orders and is a staple indicator on every active trader's chart in Indian equity and futures markets.