Open Interest is rising… but who’s opening? Longs or Shorts? 🤔
Quick definition: Open Interest (OI) is just the number of positions open.
New positions? OI ↑
Closing positions? OI ↓
that’s it.
But here’s the kicker: OI alone doesn’t tell you the side. That’s where CVD (Cumulative Volume Delta) comes in — basically, who’s pressing the buy or sell button harder.
How to read it:
📈 OI ↑ + CVD ↑ → Longs entering
Aggressive buyers pushing the price up. Bulls are opening.
📈 OI ↑ + CVD ↓ → Shorts entering
Aggressive sellers hitting bids. Price might still rise, but shorts are getting in early.
📉 OI ↓ + CVD ↑ → Shorts closing
Buyers dominating, shorts covering. Can fuel squeezes.
📉 OI ↓ + CVD ↓ → Longs exiting
Selling pressure, longs leaving. Weak market.
Conclusion:
OI tells you money is moving, CVD tells you who’s moving it.
Keep an eye on both and don’t get caught off guard 😏
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