Traders may track and compare OI at different strike prices using multistrike OI analysis.
a) OI: OI stands for Open Interest, reflecting the total number of outstanding futures or options contracts that have not been closed or offset.
Why use it?
-> Open Interest is employed by traders and analysts to assess market health, liquidity, and trader interest. It aids in identifying trends and potential market movements.
Analysis-> Instrument Overview-> Open Interest-> Multistrike OI
How to use it?
-> Traders can analyze Open Interest in conjunction with other indicators to make informed decisions.
-> Rising OI may indicate increased market activity and interest while falling OI could suggest waning interest.
1) What does it mean when Open Interest remains steady while prices rise?
-> Steady Open Interest amid rising prices may indicate that existing positions are still active, but new positions are not being added at the same pace.
a) OI Metrics in Options Trading-> Link
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