Just saw: $SOPH 5-minute contract open interest increased by 10.59%, with an open interest value of about $4.37 million; the price fell 23.48% over the same period.
People often ask how to interpret open interest. This is how I understand it.
Open interest is usually calculated separately for each trading pair. Here, it refers to positions in Binance USDT-margined perpetual contracts, not the total across all platforms.
A rapid change in open interest in the short term means that someone is building or closing positions in a concentrated way, and subsequent volatility often increases as well.
Don't place orders during the fastest-moving few minutes. Wait for the price to stabilize before deciding.
Personal notes; not specific trading advice.
People often ask how to interpret open interest. This is how I understand it.
Open interest is usually calculated separately for each trading pair. Here, it refers to positions in Binance USDT-margined perpetual contracts, not the total across all platforms.
A rapid change in open interest in the short term means that someone is building or closing positions in a concentrated way, and subsequent volatility often increases as well.
Don't place orders during the fastest-moving few minutes. Wait for the price to stabilize before deciding.
Personal notes; not specific trading advice.