The document discusses using the volume weighted average price (VWAP) to identify the strength of buying or selling in a stock. It explains that VWAP can act as support or resistance and be used to identify trends and entry points in option charts. Following VWAP in option trading over the long run can provide good risk to reward.
The document discusses using the volume weighted average price (VWAP) to identify the strength of buying or selling in a stock. It explains that VWAP can act as support or resistance and be used to identify trends and entry points in option charts. Following VWAP in option trading over the long run can provide good risk to reward.
The document discusses using the volume weighted average price (VWAP) to identify the strength of buying or selling in a stock. It explains that VWAP can act as support or resistance and be used to identify trends and entry points in option charts. Following VWAP in option trading over the long run can provide good risk to reward.
The document discusses using the volume weighted average price (VWAP) to identify the strength of buying or selling in a stock. It explains that VWAP can act as support or resistance and be used to identify trends and entry points in option charts. Following VWAP in option trading over the long run can provide good risk to reward.
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Generally, VWAP is used to know the strength in a
buying or selling. VWAP means VOLUME WEIGHTED AVERAGE PIRCE
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when price starts rising it would be pulled back
to VWAP line. Then buyers would again rush in to buy the stock taking price higher.
If we compare the CALL and PUT charts, we can
identify the correct entry. On trending days VWAP acts as support/resistance. If market is trending UPSIDE, VWAP acts as support in CALL option charts of ATM STRIKES and same VWAP acts as RESISTANCE in PUT option charts of ATM STRIKES
(Use VWAP on 5 minutes chart on OPTION
CHARTS) If market is trending DOWNSIDE, VWAP acts as support in PUT option charts of ATM STRIKES and same VWAP acts as RESISTANCE in CALL option charts of ATM STRIKE We can take the entry or average the buying price of an OPTION when price comes near to VWAP with STOP LOSS PRICE below VWAP
VWAP also helps in identifying the trend and
also gives good Risk:Reward if followed in long run
For more market related updates and strategies do
join
https://t.me/OptionsTradingWithSwapnil
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