What is volume weighted average price in crypto?
VWAP is the average crypto price weighted by trading volume at each price. It reflects one exchange and time window, so it summarizes past trades.
Vahe HakobyanEditor-in-chief
Updated Oct 6, 20263 min readFact-checked
- Calculate VWAP by multiplying price by volume, then dividing by total volume.
- Price above VWAP means current price is above the period's average trade price.
- VWAP describes past trades and does not predict future direction.
On a crypto chart, VWAP appears as a line that moves as trades arrive. You can add it in most charting tools and compare it with the price line.
How is VWAP calculated?
VWAP is the average crypto price weighted by how much volume traded at each price. To calculate it, multiply each trade's price by its volume, then add those results. Add the volumes, and divide the total value by the total volume. The time window and the exchange change the value you see, because each one includes a different set of trades.
How do you read VWAP?
On a chart, VWAP is a line that tracks the running average trade price. It moves as new trades print and their volume enters the running totals. The line gives you a reference point for the period you selected.
- Price above VWAP: current price is above the period's average trade price.
- Price below VWAP: current price is below the period's average trade price.
- Price at VWAP: current price matches the period's average trade price.
- Rising VWAP: the average trade price is moving higher as new trades arrive.
- Falling VWAP: the average trade price is moving lower as new trades arrive.
What VWAP does not tell you
VWAP looks backward. It summarizes trades that already happened, so it cannot tell you where price will go next. It also cannot tell you the best price to enter or exit. A VWAP from one exchange does not describe the whole crypto market.
Frequently asked questions
No. A simple moving average gives each price in the period equal weight, while VWAP gives more weight to prices where more volume traded.
Many charts start a new VWAP at the beginning of a session or day, but crypto trades around the clock. A daily reset is a chart setting, not a market rule.
Each exchange has its own order book and set of trades. A VWAP from one venue uses only those trades, so the same coin can show a different VWAP elsewhere.
It depends on your chart. Many tools default to one session or day, but you can usually change the start and end of the window.
