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Technical Indicators

Fri, Jun 6th, 2025
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The descriptions, formulas, and parameters shown below apply to both Interactive Charts and Snapshot Charts, unless noted. Please note that some of the parameters may be slightly different between the two versions of charts.
Studies noted with * are available only in Snapshot Charts and those noted with ^ are available only in Interactive Charts.
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Anchored VWAP (Volume Weighted Average Price)

Indicator Type: Overlay

Chart Type: Interactive Charts Only

The Anchored VWAP indicator (also known as Alphatrends Anchored VWAP) ties VWAP calculations to a specific price bar chosen by the trader. Like the traditional VWAP, it incorporates price and volume in a weighted average and can be used to identify areas of support and resistance on the chart.

However, traditional VWAP calculations always start with the first bar of the day and end with the final bar of the day. In some situations, a chartist would prefer to analyze the VWAP line based on a less arbitrary starting point, and be able to extend that VWAP line beyond the end of the trading day.

Anchored VWAP allows you to specify the price bar where calculations begin, making it easy to see whether the bulls or bears have been in charge since a very specific point in time. The starting price bar that is chosen generally marks a shift in market psychology, such as a significant high or low, earnings, news, or other announcements. The Anchored VWAP line is charted using price and volume data from that significant event onward  to encompass all the data within the calculation, until the end of the chart.

Anchored VWAP

Interpreting the Anchored VWAP

Like traditional VWAP, the Anchored VWAP overlay can be used to confirm trends and identify areas of support and resistance on the chart. The advantage of using Anchored VWAP is that you can set the starting point in order to include only relevant data on your chart.

Typically, the chartist chooses a particular event as the starting price bar for the overlay: a significant high or low, an earnings announcement, a gap, etc. These events generally signal a change in market psychology, and the price action prior to that change should be excluded from the calculations since it doesn't reflect the same market psychology.

Multiple Anchored VWAP lines can be used on a single chart, each anchored at a different starting point. Where multiple Anchored VWAP lines converge, that can indicate an especially strong area of support or resistance.

Parameters

  • Source (HLC/3): Choose from Open, High, Low, Close, HL/2, HLC/3, OHLC/4, HLCC/4

Source: Stockcharts.com

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