The Volume Weighted Moving Average shows traders the average price that an asset has traded at throughout the day based on its price and volume. The VWMA should be used in tandem with trend identifiers because it is showing you a historical average, and not what is happening currently.

When the price of an asset is above the VWMA, or positive, this represents a bullish opportunity and is likely in an uptrend.

When the price of an asset is below the VWMA, or negative, this represents a bearish opportunity and is likely in a downtrend.

Calculation:

VWMA = SUMM( Price * Volume ) / SUMM( Volume )
Where:

SUMM = the sum for N periods