Cumulative OI (Open Interest) is a feature on Stolo that offers traders a comparative chart view of the open interest for two selected strike prices, along with the price of Index or equity and the calculated Put Call Ratio (PCR).
a) PCR (Put Call Ratio): A derivative indicator used to gauge market sentiment by comparing the open interest in put options to call options.
Why Use It:
-> Cumulative OI Change helps traders understand the open interest dynamics for specific strike prices, which can be crucial for strategy development.
-> PCR offers insights into market sentiment, helping traders make informed decisions.
Analysis-> Instrument Overview->Open Interest-> Cumulative OI Change
How to Use It:
-> Select an expiry date.
-> Choose one or more strike prices.
-> View an interactive graph displaying cumulative open interest for the selected strikes.
-> Monitor the calculated PCR value and the live index or stock price for analysis.
1) What does a rising Cumulative OI indicate?
-> An increasing Cumulative OI for specific strike prices may suggest growing interest or potential price movements at those levels.
2) How is PCR calculated, and what does it indicate?
-> PCR is calculated by dividing the open interest in put options by call options. A high PCR may indicate a bullish sentiment, while a low PCR suggests a bearish sentiment.
3) How can Cumulative OI Change help in trading strategies?
-> Traders can use Cumulative OI Change to identify areas of interest in the market and potentially align their trading strategies with areas of high open interest or significant PCR values for more informed decision-making.
a) How Does OI Analysis Help to Identify Market Trends? -> Link
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