Position and price divergence generally falls into three categories. This time, $BTW saw open interest fall while the price rose (24-hour open interest: -17.59%; price: +35.82%):
· Open interest rises, price stays flat: Long and short positions are both growing, suggesting a buildup phase; volatility may increase afterward.
· Open interest rises, price falls: New short positions may be pushing the price down, though crowded shorts could also trigger a rebound.
▶ Open interest falls, price rises: Often driven by short covering; whether the rally continues depends on new money stepping in.
Open interest is currently worth about $142 million. Which way do you think it’ll go? Share your thoughts in the comments.
· Open interest rises, price stays flat: Long and short positions are both growing, suggesting a buildup phase; volatility may increase afterward.
· Open interest rises, price falls: New short positions may be pushing the price down, though crowded shorts could also trigger a rebound.
▶ Open interest falls, price rises: Often driven by short covering; whether the rally continues depends on new money stepping in.
Open interest is currently worth about $142 million. Which way do you think it’ll go? Share your thoughts in the comments.