VWAP Upper and Lower Bands Formula: A Guide to Forex Trading

5 min read

VWAP Upper and Lower Bands is a custom technical indicator for traders interested in analyzing market volume dynamics. The indicator is similar to a standard VWAP (Volume Weighted Average Price) but includes price levels at which the overall market is overbought or oversold. The upper and lower bands are formed when an abnormal increase or decrease in price combined with exceptionally high volumes occurs in the market. Using VWAP Upper and Lower Bands to determine the fair value in the market is a great way for traders to identify potential entry or exit points. By monitoring the price action of stocks, Forex instruments or commodities around the VWAP Upper and Lower Bands, traders can assess risk as well as gain insight into potential opportunities ahead.