The VWAP Williams %R strategy focuses on intraday reversion around the Volume Weighted Average Price. It observes when price drifts away from VWAP while the Williams %R oscillator reaches oversold or overbought territory. The assumption is that extreme readings near VWAP often lead to a snapback toward the mean.
When the oscillator drops below -80 and price trades under VWAP, the setup implies selling pressure is fading and a rebound may follow. Conversely, a reading above -20 while price is positioned above VWAP warns that buyers are exhausted and a pullback is likely. The strategy opens trades in the direction of a potential return to VWAP and watches for that move to complete.
This approach fits active intraday traders who prefer frequent mean reversion opportunities. A small stop‑loss relative to VWAP keeps risk contained while still allowing enough room for price to fluctuate before reversing.
- Entry Criteria:
- Long: Price < VWAP && Williams %R < -80 (oversold below VWAP)
- Short: Price > VWAP && Williams %R > -20 (overbought above VWAP)
- Long/Short: Both sides.
- Exit Criteria:
- Long: Exit long position when price breaks above VWAP
- Short: Exit short position when price breaks below VWAP
- Stops: Yes.
- Default Values:
- WilliamsRPeriod = 14
- StopLossPercent = 2m
- CandleType = TimeSpan.FromMinutes(5)
- Filters:
- Category: Mixed
- Direction: Both
- Indicators: VWAP Williams R
- Stops: Yes
- Complexity: Intermediate
- Timeframe: Intraday
- Seasonality: No
- Neural networks: No
- Divergence: No
- Risk Level: Medium