There are roughly three types of divergence between open interest and price. This time, $RSR saw open interest rise while price fell (24-hour open interest +186.18%, price -12.15%):
· Rising open interest, flat price: Both long and short positions are growing, suggesting a buildup before a move; volatility may increase afterward.
▶ Rising open interest, falling price: Often indicates new shorts are pressing the market, though crowded short positions can also trigger a rebound.
· Falling open interest, rising price: Often reflects short covering driving prices up; its staying power depends on whether fresh capital follows through.
Open interest is currently around $12.64 million. Which direction do you favor?
#RSR
· Rising open interest, flat price: Both long and short positions are growing, suggesting a buildup before a move; volatility may increase afterward.
▶ Rising open interest, falling price: Often indicates new shorts are pressing the market, though crowded short positions can also trigger a rebound.
· Falling open interest, rising price: Often reflects short covering driving prices up; its staying power depends on whether fresh capital follows through.
Open interest is currently around $12.64 million. Which direction do you favor?
#RSR