Technical note | $PYTH | 15-minute position: +4.04% | Price: +2.25%
First, a definition: Open interest is usually tracked separately for each contract. Here, it refers to open interest in Binance USDⓈ-M perpetual contracts, not the total across the entire market.
A common interpretation: Rising prices with falling open interest are generally understood as being driven by short covering, while falling prices with falling open interest are generally understood as longs closing their positions. These are assumptions, not conclusions.
Sizing your position based on the stop-loss distance is much more reliable than placing orders by guesswork.
First, a definition: Open interest is usually tracked separately for each contract. Here, it refers to open interest in Binance USDⓈ-M perpetual contracts, not the total across the entire market.
A common interpretation: Rising prices with falling open interest are generally understood as being driven by short covering, while falling prices with falling open interest are generally understood as longs closing their positions. These are assumptions, not conclusions.
Sizing your position based on the stop-loss distance is much more reliable than placing orders by guesswork.