Decoding the Open Interest Metric for Trend Confirmation.
Decoding the Open Interest Metric for Trend Confirmation
Open Interest (OI) is a crucial metric in the world of crypto futures trading, often overlooked by beginners but possessing significant power in confirming trends and gauging market sentiment. While price action is the primary driver of trading decisions, OI provides a vital layer of context, helping traders understand *why* prices are moving and how sustainable those movements might be. This article will delve into the intricacies of Open Interest, explaining its meaning, how to interpret it, and how to use it to bolster your trend confirmation strategies.
What is Open Interest?
At its core, Open Interest represents the total number of outstanding futures contracts that are currently held by traders. It’s not si
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