What is Open Interest?

note

This is a work in progress and can change on the final version.

Open Interest (OI)

Tells you how many dollars are betting right now.

3-second read

• OI = $1.2 B → 1.2 billion dollars in open trades.
• OI rises → new money jumps in.
• OI drops → traders close or get wrecked.

What it screams

OI + price up → Longs are winning. More pile in.
OI + price down → Shorts are winning. More pile in.
OI crashes → Liquidation storm just happened.

3 rules, 1 glance

1. Open trade when OI is flat or dropping → less crowded.
2. Never fight rising OI against you → you vs the herd = pain.
3. Check OI on the chart → one bar = “calm” or “war”.

Bottom line

High OI = big fight, big move coming.
Low OI = sleepy, boring price.