What Does Increase In Open Interest Mean. If there is a greater volume of options marked to open than to close open interest increases and vice versa for decreases. Similarly an increase in open interest along with a decrease in price confirms a downward trend.
Increasing open interest represents new or additional money coming into the market while decreasing open interest indicates money flowing out of the market. OI is the outstanding buy or sell position in futures and options contract at the end of each day. By monitoring the changes in the open interest figures at the end of each trading day some conclusions about the day s activity can be drawn.
Therefore for every buyer there is an equal and opposite seller Trader 2.
OI is the outstanding buy or sell position in futures and options contract at the end of each day. Open interest will also increase when new futures or options are created. Open interest equals the total long or the total short positions. Increasing open interest represents new or additional money coming into the market while decreasing open interest indicates money flowing out of the market.
