VWAP - Did you try it? Do you use it?
- Thread starter easymon1
- Start date
Yeah, the funny thing is that when traders at banks/hedge funds put in orders, they are not analyzing the price chart to make a call. I think this is something retail traders can learn from pros -- separate your trading function with your idea generation and risk management functions.%%
I see why some use it/ any average can be helpful.
I have in the past had so may indicators on my candle CHARTS, CANT SEE PRICE...............................................................................
It should be:
1. Generate an idea --> evaluate it based upon your trading/investment philosophy, including the price range that you'd like to buy, a price target to sell at, and
2. Evaluate risk and determine weight in your portfolio, also set max loss threshold
3. Trade --> try to get in at optimal price within your timeframe
If your trading framework is very short term (5-10 minutes in/out) then you need to have your workflow down so you can quickly move through 1-2-3.
Stuff bank/fund traders look at:
market depth review:
modeling volume through the day, and how today's volume compares:
viewing distribution of fills (at bid/offer/mid):
looking at broker rankings:
estimating your transaction costs:
%%
I should maybe study your VWAP chart more.
And also i remember General K Haggerty[Head Trader of Fidelity Capital Markets] admitted many institutions will not admit they use 200 day moving average, but they do . Good to know/even though there are many kinds of 200dmas, adding to complexity...................................................
That's because the slope of the 200dma is a good proxy for stock price autocorrelation. Note: for single stocks, most traders exclude the last month due to the short term reversal factor. So a lagged 250/200dma, ranked vs other stocks, can be an easy way to spot companies that will be added to those portfolios. Another way retail can ride the wave of larger traders/investors.
Is that anything like MMMBop?
VINCENTNYC USES IT AND HE APPROVES!
Ditto, except for the consideration of volume.
My take.... Considering volume won't make for bad trades, but it will cause missing some good trades when "volume doesn't confirm (in your mind) a good price read".
easymon1,
If a NFL football player entering the NFL in 2021, and the player had the choice of playing for any head coach of the player choosing with the goal of winning a super bowl in the next 2 years, is there a high probability the player will choose Bill Belichick?
The answer is Yes. The player will spend 2 minutes and 8 times of 10, choose to play for Bill Belichick. Why? Bill has a proven track record of success.
The same applies to trading. You need find a proven a trading record performance that shows VWAP provides edge discretionary or automated.
Past history performance is the best predictor of future success.
VWAP Traders -
When you use your VWAP Setups, what similarities are there to similar setups that are applied to 'standard' moving averages, a 50 MA for example?
What differences are there in the way you trade VWAP vs. standard MA?
Do most VWAP traders add standard deviation lines to their VWAP charts?
When you use your VWAP Setups, what similarities are there to similar setups that are applied to 'standard' moving averages, a 50 MA for example?
What differences are there in the way you trade VWAP vs. standard MA?
Do most VWAP traders add standard deviation lines to their VWAP charts?