$ICNT ｜1-hour open interest +8.03%｜Price +2.46%
Before discussing capital flows, let's first understand open interest.
Open interest and trading volume are two different things: trading volume is how much has changed hands during a period, while open interest is how many contracts are still open at a given moment.
Rising prices with falling open interest are often seen as driven by short covering; falling prices with falling open interest are generally interpreted as longs exiting via stop-losses. These are just rules of thumb, not definitive conclusions.
Understanding an indicator helps you avoid being spooked by a single number; it isn't a way to pinpoint tops and bottoms.
#ICNT
Before discussing capital flows, let's first understand open interest.
Open interest and trading volume are two different things: trading volume is how much has changed hands during a period, while open interest is how many contracts are still open at a given moment.
Rising prices with falling open interest are often seen as driven by short covering; falling prices with falling open interest are generally interpreted as longs exiting via stop-losses. These are just rules of thumb, not definitive conclusions.
Understanding an indicator helps you avoid being spooked by a single number; it isn't a way to pinpoint tops and bottoms.
#ICNT