| Price Action | OI Change | Interpretation/Bias | Correlation Color | Histogram is Smaller (Weaker Flow Momentum) | Histogram is Bigger (Stronger Flow Momentum) |
|---|---|---|---|---|---|
| Rises | Green Bars π’ | Strong Bullish / Long Confirmation (New money is entering on the long side, confirming the uptrend) | π’ (Bullish) | Momentum is weakening. New capital inflow is slowing down; the rally is losing intensity. | Momentum is strengthening. New capital inflow is accelerating; the rally is gaining intensity. |
| Rises | Red Bars π΄ | Weakening Bullish/Short Signal (Current rally based on short covering; uptrend unsustainable) | π (Bearish) | Liquidation pressure is easing. The rate of money leaving (selling) is slowing down; could signal consolidation or reversal. | Liquidation pressure is intensifying. The rate of money leaving (selling) is accelerating; correction is deepening. |
| Falls | Green Bars π’ | Strong Bearish/Short Confirmation (New money is entering on the short side, confirming the downtrend). | π (Bearish) | Momentum is weakening. New short capital inflow is slowing down; the sell-off is losing intensity. | Momentum is strengthening. New short capital inflow is accelerating; the sell-off is gaining intensity. |
| Falls | Red Bars π΄ | Weakening Bearish/Long Signal (Downtrend based on long liquidation; downtrend unsustainable). | π’ (Bullish) | Covering pressure is easing. The rate of money entering (covering) is slowing down; bounce may be ending. | Covering pressure is intensifying. The rate of money entering (covering) is accelerating; strong rebound or short squeeze underway. |
| Sideways | Green Bars π’ | Accumulation/Distribution (Smart money is building a position). Look for breakout confirmation. | Varies | Low conviction consolidation. Slow net flow indicates a lack of aggressive participation. | Aggressive accumulation/distribution. High net flow suggests smart money is taking aggressive positions for an imminent, high-conviction breakout. |
Last active
November 27, 2025 03:06
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How to Interpret Open Interest (OI) and Price: A Trader's Cheat Sheet
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