Regular VWAP resets every day. Anchored VWAP does not. You pick the anchor point and the line tells you the volume weighted average price since that bar. Every share traded since the anchor counts, weighted by how big the trade was.
The power is in the anchor selection. Anchor to the last earnings beat and the line shows you whether the average buyer since that report is in profit or in loss. Anchor to a swing low and you see whether buyers from that level still have skin in the game.
Price above anchored VWAP: average buyer since the anchor is in profit. Bullish.
Price below anchored VWAP: average buyer since the anchor is underwater. Bearish.
Price testing anchored VWAP from above: support. Buyers defend their average. Add or hold.
Price testing anchored VWAP from below: resistance. Buyers underwater want to break even and sell. Sellers active.
Bullish setup: price has been above the anchored VWAP for weeks. It pulls back to the line. Reversal candle prints at the line. Enter long. Stop below the swing low under the line.
Bearish setup: price has been below anchored VWAP for weeks. Rally up to the line. Failed retest with rejection candle. Enter short. Stop above the swing high above the line.
I often have two or three anchored VWAPs on the same chart. Earnings anchor. Recent swing low anchor. Last Fed meeting anchor. Where multiple lines converge, the level matters more.
Confluence of two anchored VWAPs at the same price is a higher probability level than either alone.
Major new event. New earnings report. New swing extreme. Major news. The old anchor still has analytic value but a new one becomes the relevant reference for the current regime.
I do not delete old anchors. I add new ones. Looking at three or four anchor points across a chart tells a richer story than one.
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