Open Interest (OI) indicates the total number of contracts currently open in the market.

-> It reflects whether new cash is flowing in or out.

🧠 When combined with price volatility, we can determine:

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

✔ Is the trend still strong or has it weakened?

✔ Is the market attractive, or is it just a 'false' increase or decrease due to closing positions?

✔ Catch the trend early and make more confident trades

🎯 How to apply in Futures trading

Never look at a single price → must also consider OI.

Increase while OI decreases → beware of a bull trap.

Decrease while OI increases → the market is really bearish.

OI continuously increases → the market is preparing for a major trend.

OI continuously decreases → the market is sideways or about to reverse.

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