Follow or fade the VWAP?

[1a2b3cppp]

Additionally, when does the VWAP start? I feel like it starts after regular trading hours on my chart.



Perhaps you can trade in the direction of VWAP. This is what that chart displays.

Or wait until price gets some length away from VWAP and do the opposite.

 

[1a2b3cppp]

 

[SunTrader]

Additionally, when does the VWAP start? I feel like it starts after regular trading hours on my chart.

....
Or wait until price gets some length away from VWAP and do the opposite.

First got to say I can't tell you how your VWAP works because I don't even know what software you are using or timeframe or time period of your chart. Beats me. Probably wouldn't know anyway. When it comes to trading platforms, although there are some similarities, each do things their own way.

As for when VWAP gets some length away - sure but how do you determine "some length" is the right length?

A suggestion is to test BBands set to 3 standard deviations. Wait for close outside band. Both on attached chart barely made the cut, 1st closing at 2791.00 with lower band at 2791.05, and 2nd 2793.50 and 2793.60 but they would have been nice entries nonetheless.

 

[vanzandt]

Depending on the stock, the day, and the time of day... VWAP is the best short term indicator for momentum based direction reversal there is.
It works best on high vis stocks that are trading well above their average daily volume. SPY too on high volume days.

 

[1a2b3cppp]

Depending on the stock, the day, and the time of day... VWAP is the best short term indicator for momentum based direction reversal there is.
It works best on high vis stocks that are trading well above their average daily volume. SPY too on high volume days.

Are you able to talk about momentum based direction reversal?

 

[1a2b3cppp]

First got to say I can't tell you how your VWAP works because I don't even know what software you are using or timeframe or time period of your chart. Beats me. Probably wouldn't know anyway. When it comes to trading platforms, although there are some similarities, each do things their own way.

As for when VWAP gets some length away - sure but how do you determine "some length" is the right length?

A suggestion is to test BBands set to 3 standard deviations. Wait for close outside band. Both on attached chart barely made the cut, 1st closing at 2791.00 with lower band at 2791.05, and 2nd 2793.50 and 2793.60 but they would have been nice entries nonetheless.
View attachment 189522

I did a system with 2.5 amount standard deviation on bollinger bands.

https://www.elitetrader.com/et/threads/making-bollinger-band-fading-profitable.266426/

 

[SunTrader]

Are you able to talk about momentum based direction reversal?

That would be counter momentum which is what I previously posted - BBands.

Beyond that though there are all kinds of ways to trade against momentum. Most of the time I do that only within a correction against the main trend.