Traders use open interest as a tool to gauge the overall health of a specific futures market
Rising & falling open interest levels measure the strength or weakness of a price trend
If a market has been in a long-lasting uptrend or downtrend, with increasing levels of open interest, a leveling off or decrease in open interest can be a "red flag", signaling that the trend may be nearing its end.
Rising & falling open interest levels measure the strength or weakness of a price trend
If a market has been in a long-lasting uptrend or downtrend, with increasing levels of open interest, a leveling off or decrease in open interest can be a "red flag", signaling that the trend may be nearing its end.