Open Interest (OI): Following the Big Money
Price tells you what happened. OI tells you what might happen.
The Golden Rules of OI
Since Option Sellers are the smart money (Institutions), we interpret OI from their perspective.
| Price Action | OI Action | Interpretation |
|---|---|---|
| Price UP | OI UP | Long Buildup: Bulls are aggressive. Strong Bullish. |
| Price DOWN | OI UP | Short Buildup: Bears are aggressive. Strong Bearish. |
| Price DOWN | OI DOWN | Long Unwinding: Bulls are exiting. Correction/Weakness. |
| Price UP | OI DOWN | Short Covering: Bears are panicking and exiting. Explosive Up. |
*Disclaimer: NSE/BSE frequently revise Lot Sizes and Expiry Days (e.g., SEBI Circulars 2024/2025). Always check the latest circular on nseindia.com before trading.
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