Market Notes｜$MEW ｜1-hour open interest +19.72%｜Price +2.69%
First, a definition: contract open interest reflects the combined demand for speculation and hedging. Some positions are held solely to hedge spot-market risk.
Next, how to read it: rising prices with falling open interest are generally interpreted as being driven by short covering, while falling prices with declining open interest are often seen as longs exiting via stop-losses. These are rules of thumb, not definitive conclusions.
Unusual data often signals greater volatility. In such cases, it’s better to reduce leverage than to make a large bet.
#MEW
First, a definition: contract open interest reflects the combined demand for speculation and hedging. Some positions are held solely to hedge spot-market risk.
Next, how to read it: rising prices with falling open interest are generally interpreted as being driven by short covering, while falling prices with declining open interest are often seen as longs exiting via stop-losses. These are rules of thumb, not definitive conclusions.
Unusual data often signals greater volatility. In such cases, it’s better to reduce leverage than to make a large bet.
#MEW