Market Notes｜$KAVA ｜1-hour open interest +6.49%｜Price -2.89%
Definition: Every new position opened always has someone going long and someone going short at the same time, so “an increase in open interest means the market is bullish” is a common misconception.
How to read it: A rapid change in open interest over the short term indicates that someone is opening or closing a large number of positions, and volatility often increases afterward.
Comparing several data points is more reliable than looking at just one, but even more indicators still can’t provide a definitive conclusion.
Definition: Every new position opened always has someone going long and someone going short at the same time, so “an increase in open interest means the market is bullish” is a common misconception.
How to read it: A rapid change in open interest over the short term indicates that someone is opening or closing a large number of positions, and volatility often increases afterward.
Comparing several data points is more reliable than looking at just one, but even more indicators still can’t provide a definitive conclusion.
