Why is Open Interest important?

Open Interest (OI) indicates the total number of open contracts in the market.
-> It reflects whether new money is flowing in or out.

🧠 When combined with price volatility, we can determine:

✔ Who is controlling the market (Long or Short) -> Avoid bull trap / bear trap(

✔ Is the trend still strong or weakening

✔ Is the market attractive, or just “fake” movements caused by closing positions

✔ Catch the trend early and enter more confidently
🎯 How to apply this in Futures trading

Never look at price alone → always consider OI.

Rising OI while price decreases → beware of bull trap.

Falling OI while price increases → the market is truly bearish.

Continuous increase in OI → the market is preparing for a major trend.

Continuous decrease in OI → the market is sideways or about to reverse.

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