Glossary
VWAP (volume-weighted average price)
The average price weighted by volume, usually reset at the start of each session. On CFDs it is built from the broker's tick volume.
VWAP (volume-weighted average price) is the sum of price × volume divided by the sum of volume since a chosen starting point, usually the session open. Many platforms use each bar's typical price, (high + low + close) ÷ 3. Spot gold and currency CFDs have no central exchange volume, so platforms use tick volume, the number of price updates, and VWAP can differ from broker to broker.
Example
Three bars since the session open: 4,000.0 with volume 200, 4,010.0 with volume 300 and 4,020.0 with volume 500. Price × volume adds up to 800,000 + 1,203,000 + 2,010,000 = 4,013,000, and volume to 1,000. VWAP = 4,013,000 ÷ 1,000 = 4,013.0.
Why it matters
On exchange-traded markets, VWAP is a common benchmark for the quality of execution. For CFD traders it is an approximation. In our lab, gold scalping rules built on deviation from the session VWAP did not survive costs.