By anchoring to the right event, waiting for the retest, and riding the deviation bands, you transform from a gambler into a systematic gain-harvester.
This setup captures massive momentum as volatility contracts tightly around the fundamental cost basis. Anchor a VWAP to a major gap-up earnings candle. Step 2: Allow the stock to consolidate for several weeks.
Wait for a decisive daily close outside of the AVWAP pinch. Buy a breakout above the upper AVWAP line, or short a breakdown below the lower AVWAP line.
Popularized by expert trader Brian Shannon, this tool helps identify "fair value" and reveals who is truly in control of a trend. Why Anchored VWAP is a Game-Changer maximum trading gains with anchored vwap pdf download
Enter long only when price is above the AVWAP line and the MACD histogram prints a bullish crossover. Horizontal Liquidity Convergence
This convergence represents an incredibly strong, dual-layered support or resistance area that maximizes your probability of success. Strategy C: The Failed Breakout Reversal
For currencies, commodities, and index futures, anchor to major macroeconomic events. Key events include Federal Reserve interest rate decisions, Consumer Price Index (CPI) releases, or Non-Farm Payrolls (NFP) updates. By anchoring to the right event, waiting for
Identify a stock that recently bottomed out and began a powerful uptrend on high volume.
: It reveals whether buyers or sellers who entered the market at a major event are currently sitting on profits or losses. Setting Up Your Anchored VWAP
: Anchor to absolute swing highs and swing lows to find long-term trends. Step 2: Allow the stock to consolidate for several weeks
, a powerful technical indicator that bridges the gap between price, time, and market volume. Standard VWAP resets automatically at the start of every intra-day trading session, but Anchored VWAP allows you to choose exactly where the calculation begins. By pinning the indicator to a significant psychological market event—like an earnings release, an IPO, or a major swing high/low—you can pinpoint institutional support and resistance with incredible accuracy.
The Anchored VWAP strategy offers several benefits to traders:
Days with exceptionally high trading volume, representing massive institutional accumulation or distribution.
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