About the VWAP Bands Indicator
VWAP Bands is a Forex indicator for MetaTrader 4 built around the Volume Weighted Average Price concept.
Instead of using a single VWAP line, this tool expands the analysis by adding multiple deviation bands above and below VWAP.
In total, the indicator plots seven bands based on standard deviation, offering a detailed view of price positioning.
The indicator is especially effective during sideways or balanced market conditions.
When price oscillates around VWAP, the outer bands often act as dynamic boundaries where short-term reversals can occur.
This makes VWAP Bands suitable for traders who focus on mean-reversion setups rather than strong directional trends.
VWAP Bands can be traded as a standalone system or used as a supporting indicator within an existing strategy.
Its band-based logic helps traders identify overextended price moves and plan both entries and exits with discipline.
Free Download
Download the “vwap-bands-indicator.mq4” indicator for MT4
Key Features
- Based on VWAP with multiple standard deviation bands.
- Plots a total of seven dynamic price bands.
- Optimized for sideways and ranging market conditions.
- Compatible with all MT4-supported markets.
Indicator Chart
The chart below shows the VWAP Bands indicator applied to a ranging Forex market.
Price fluctuates between the upper and lower green bands while VWAP remains relatively flat.
These zones highlight potential buy and sell opportunities when price becomes stretched.
Guide to Trade with VWAP Bands
Buy Rules
- Confirm that the VWAP bands are moving sideways.
- Wait for the price to reach the green lower VWAP band.
- Enter a buy trade after price shows stabilization.
Sell Rules
- Confirm that the VWAP bands remain flat.
- Wait for the price to reach the green upper VWAP band.
- Enter a sell trade after price begins to stall.
Stop Loss
- Place stop loss slightly beyond the outer VWAP band.
- Allow additional room during higher volatility sessions.
Take Profit
- Target the central VWAP line as the first objective.
- Extend the take profit toward the opposite VWAP band.
VWAP Bands + Winning Super Trend MT4 Forex Strategy
This Forex trading strategy combines the VWAP Bands Forex Indicator for MT4 with the Winning Super Trend Forex Indicator for MT4 to create a powerful short-term scalping system.
It works best on M1, M5, and M15 charts, allowing traders to identify low-risk, high-probability entries based on price interaction with VWAP bands and trend direction confirmation from the Super Trend indicator.
The VWAP Bands indicator identifies overbought and oversold price areas relative to the Volume Weighted Average Price.
When the bands move sideways, it often means the market is consolidating or preparing for a short-term reversal.
The Winning Super Trend indicator confirms the direction using color-coded lines: green for bullish and red for bearish conditions.
Together, these two tools help scalpers and day traders catch short bursts of price movement with precision.
Buy Entry Rules
- Wait for the VWAP Bands to move sideways, signaling a stable market range.
- Confirm that price touches or slightly breaks below the lower green VWAP band.
- Check that the Winning Super Trend line turns green, confirming a bullish reversal.
- Enter a buy trade at the close of the confirmation candle.
- Place a stop loss 5 to 10 pips below the recent low or below the lower VWAP band.
- Take profit at the middle VWAP line or when the price touches the upper VWAP band.
Sell Entry Rules
- Wait for the VWAP Bands to move sideways, showing consolidation.
- Confirm that price touches or slightly breaks above the upper green VWAP band.
- Check that the Winning Super Trend line turns red, confirming a bearish move.
- Enter a sell trade when the candle closes below the upper VWAP band.
- Place a stop loss 5 to 10 pips above the most recent high or above the upper VWAP band.
- Take profit near the middle VWAP line or when the price touches the lower VWAP band.
Advantages
- Perfect for short-term scalping on M1–M15 timeframes.
- Combines volume-based levels (VWAP) with strong trend confirmation.
- Works effectively in both sideways and mildly trending markets.
- Offers clear visual entries and exits with minimal chart clutter.
Drawbacks
- Less effective during high-volatility news spikes.
- May produce whipsaws in very tight ranging conditions.
Case Study 1 – GBP/USD (M5 Chart)
On the GBP/USD M5 chart, the VWAP Bands flattened during the London open.
Price dipped to the lower green VWAP band at 1.2808 while the Winning Super Trend turned green.
A buy order was opened at 1.2810 with a 7-pip stop loss.
The price moved quickly up to 1.2825, touching the middle VWAP level for a +15-pip gain.
This setup showed how sideways VWAP conditions can signal profitable intraday reversals.
Case Study 2 – USD/JPY (M15 Chart)
On the USD/JPY M15 chart, VWAP Bands were horizontal during mid-Asia trading hours.
The price touched the upper VWAP band at 151.60, while the Winning Super Trend switched to red.
A sell trade was taken at 151.58 with a 10-pip stop loss.
The pair dropped steadily to 151.30 before the next signal, generating +28 pips.
The combination of VWAP-based resistance and trend confirmation helped avoid premature entries.
Strategy Tips
- Use this system mainly during the London and New York sessions for stronger market activity.
- Avoid trading during high-impact news to prevent false VWAP touches.
- On M1 and M5 charts, reduce position size to manage risk due to quick reversals.
- When VWAP bands start to slope strongly, pause trading until they flatten again.
- For confirmation, look for price rejection candles (such as pin bars) near VWAP boundaries.
Download Now
Download the “vwap-bands-indicator.mq4” indicator for Metatrader 4
FAQ
Why does VWAP Bands work best in sideways markets?
During sideways conditions, price frequently returns to its average value.
VWAP Bands highlight these extremes, making them suitable for mean-reversion trades.
Can VWAP Bands be used during strong trends?
The indicator can still provide information, but signals are less reliable.
In trending markets, price may stay near the outer bands for extended periods.
Do all seven bands need to be visible?
Not necessarily. Some traders reduce the number of bands to focus only on the most relevant deviation levels.
Summary
VWAP Bands is a practical MT4 indicator designed for traders who focus on range-bound price action.
Its deviation bands help identify overextended moves and logical reversal zones around VWAP.
This makes trade planning more systematic and disciplined.
The indicator is easy to configure and integrates well with existing trading methods.
With added session filters or alerts, its usability could be further improved.
For traders who value VWAP-based analysis in sideways markets, VWAP Bands is a reliable technical tool.
