Skip to main content

How to do an Intraday VWAP Analysis


In my recent VWAP webinar, I showed you two trading setups you can use with the VWAP indicator. One setup which you can use when there is a rotation and the other setup when there is a trend.
BTW. if you missed the webinar you can watch it here:
VWAP Trading Strategies – Webinar
Today, I would like to show you how you can apply those setups in your trading.
I will demonstrate this on a 60 Minute AUD/JPY chart. I will use a Weekly VWAP – which means that every new week a new VWAP gets calculated anew.

Trend vs. Rotation

The first thing you need to do is to identify whether there is a trend or a rotation. Why? Because in the trend you will want to use the “Trend VWAP  setup” and in rotation the “Rotation VWAP setup”.
As I said at the webinar – it is best to use VWAP deviations to identify a trend from a rotation. When deviation (the grey line) moves vertically, then there is a trend. When it moves horizontally, then there is a rotation.
In the picture below, I divided the chart into four sectors.
In the first one, the 1st deviation (grey line) moves downwards – so there is a trend and we want to trade the “Trend VWAP setup“
In the second section, the 1st deviation moves horizontally. This means there is a rotation and we want to look for the “Rotation VWAP setup“.
The third section shows a trend again, so we want to look only for the “Trend VWAP setup“.
The most recent section shows a rotation, so now I am looking for the “Rotation VWAP setup”.
The Special Webinar -50% Sale ends this Friday 27th. You can get it here:
Elite Pack -50%  SALE

Trade entries

The picture below shows the same chart. This time I indicated possible trade entries. Those trade entries are based on the two VWAP setups.
The first trade is a short and it is based on the “Trend VWAP setup”. Then the second trade is also a short but this time it is based on the “Rotation VWAP setup”. The same goes for the next four trades (all based on “Rotation VWAP setup”). Then the market goes into a trend again so the next trade is a long and it is based on the “Trend VWAP setup”.

The current rotation

Currently, there is a rotation and there are two areas where we could trade from – long and short.
What I like about the short is a confluence with Volume Profile indicator. If you use the Volume Profile to look into the recent selling area, then you can see that there is a “volume cluster“. This means heavy volumes got traded there. Quite possibly volumes of aggressive sellers who are currently pushing the price downwards. If the price makes it back to this area again, then those sellers could start selling aggressively again and defend their short positions. This would help to move the price downwards again.
This makes this area (around 66.30) an interesting place for a short trade. I marked it in the 60 Minute chart below:
I hope you guys liked today’s VWAP analysis. Let me know what you think in the comments below.
Stay safe and happy trading!
-Dale

Comments

  1. Software engineering3/27/20, 7:07 AM

    Dear trade I want to give me this.book volume profile at free if you can than I will.back you or I buy u becouse now I have.no money so I wanna reading this book than I will back you feedback

    ReplyDelete

Post a Comment

Popular posts from this blog

How to Track The Institutions With Volume Profile – Weekly Trading Ideas 6.4.2020

*Disclaimer: Presented opinions, trades and trading ideas on the markets and charts is not advice nor a trading recommendation. It is general information and it is for educational purposes only. **You can learn more about my trading setups in my new book: VOLUME PROFILE: The insider’s guide to trading If you would like to learn to trade with Volume Profile and to trade with me every day, then join my Trading Course!
Post a Comment
Read more

Recent Trade Breakdown: Combining Price Action & Volume Profile for Smarter Trades

Video Transcript: Hello everyone, it’s Dale here. In this new video series, I want to break down my recent trades. The goal of this series is to show you how I use my Volume Profile trading setups every day in real market conditions, so you can learn from both my wins and my mistakes. If you find this helpful, don’t forget to hit the like and subscribe buttons. Let’s dive in. What you see before you is a screenshot from my session yesterday. It’s taken from the live trading room we held in the  Funded Trader Academy . During that session, a new setup was forming on the  AUD/USD . This is the  AUD/USD  on a 30-minute timeframe, and the new setup was forming right here. There was a resistance level forming around  0.6364 . The reason behind this setup was based on a couple of factors. The main reason was a Volume Profile setup. If you look here at what I’ve highlighted, this area represents a heavy volume zone, which the resistance level was based on. You can see ...
Post a Comment
Read more

ORDER FLOW: How to Trade the Absorption Setup (Trade Entry Confirmation)

Video Transcript: Hello everyone, and in this video, I’d like to talk about order flow and one of my favorite confirmation setups in order flow. The confirmation setup is called the absorption, and I’ll show you an example of a trade I made a couple of days ago. I think this is the perfect example of how you can use the absorption setup to confirm your trade entry. So, let’s take a look at it. First, let me start by showing you the level I wanted to trade, and then I’ll show you the absorption setup. You’re looking at the  EUR/USD  30-minute chart, and I had a long level here, marked by this line. This was a long level based on a Volume Profile setup, focusing on those heavy volumes formed within this important rejection. So, this was the long level. What happened was that the price started to go into a sudden sell-off, and there wasn’t really any strong macro news behind this. I wasn’t really sure what was going on, but there was this sudden sell-off, this spike move. Because...
Post a Comment
Read more