Types of OPEN INTEREST Buildup: A thread🧵
Let's understand with example of #banknifty.
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@kuttrapali26 @chartmojo @Stock_Precision
Let's understand with example of #banknifty.
♻️Retweet for max reach.
#StockMarket #StockMarketindia #SGXNIFTY
@kuttrapali26 @chartmojo @Stock_Precision
1⃣What is Open Interest?
Open interest is the number of options or futures contracts that are held by traders and investors in active positions. These positions have been opened, but have not been closed out, expired, or exercised.
Open interest is the number of options or futures contracts that are held by traders and investors in active positions. These positions have been opened, but have not been closed out, expired, or exercised.
2⃣Difference between open interest and volume?
Volume refers to the number of contracts that have been traded in a given period, and open interest indicates the number of contracts that are active, or not settled.
Volume refers to the number of contracts that have been traded in a given period, and open interest indicates the number of contracts that are active, or not settled.
3⃣What is Short covering?
Suppose, you've a short position and now you've to square off your shorts then how will you sq off?
Either by buying at target or SL, Right?
So, when in the market huge shorts are present and people sq off their positions, it leads to short covering.
Suppose, you've a short position and now you've to square off your shorts then how will you sq off?
Either by buying at target or SL, Right?
So, when in the market huge shorts are present and people sq off their positions, it leads to short covering.
Identification of Short Covering on charts:
👆Price Up
👇OI Down
👆Price Up
👇OI Down
4⃣What is Long Buildup?
A long build up is when there is a rise in open interest and volumes along with an increase in the price of the underlying stock in the Futures and Options segment.
Identification of Long Buildup on charts:
👆OI Up
👆Price Up
A long build up is when there is a rise in open interest and volumes along with an increase in the price of the underlying stock in the Futures and Options segment.
Identification of Long Buildup on charts:
👆OI Up
👆Price Up
5⃣What is Short Buildup?
It means more people are expecting the prices to go down and creating Shorts.
If the price goes down and OI goes up then it is Short buildup.
This signifies more traders are expecting the prices to go down.
Identification:
👆OI Up
👇Price Down
It means more people are expecting the prices to go down and creating Shorts.
If the price goes down and OI goes up then it is Short buildup.
This signifies more traders are expecting the prices to go down.
Identification:
👆OI Up
👇Price Down
6⃣What is Long Unwinding?
The concept remains the same. People who have Long positions will have to sell the positions.
The price will decrease and OI will also decrease. This signifies Long Liquidation / unwinding.
Identification:
👇OI down
👇Price Down
The concept remains the same. People who have Long positions will have to sell the positions.
The price will decrease and OI will also decrease. This signifies Long Liquidation / unwinding.
Identification:
👇OI down
👇Price Down
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