OI change : how to interpret

Hi all…

I’m giving you today’s (28/9/2021) scenario and so tell me how to interpret the oi change…

Market opened by around 17900 and came down to 17850 by 10 o clock… It went down to 17600 by late afternoon and recovered a little back then and closed at 17750… Likewise in the 18100 to 17650 strikes CE OI went up and PE OI decreased… But in the last hour CE OI decreased and PE increased but as a whole, considering the whole day’s OI change, even 17650 CE is twice than 17650 PE… Same for 17700, 17750, 17800 upto 18100…

So what does this indicate? Do the 17650 CE writers think that market will do down to 17650 and even below by tomorrow (the next day)?

Is that somekind of strategy interpreting the daily OI change?

Will this work most of the times if market condition remains same without any new news coming in?

In short, I’m asking that can oi change in today’s market be an indicator of tomorrow’s market scenario?


Few points from myside:

  1. Never create a system solely based on OI data. Its always good to link it with other parameters like price action,indicator, max pain or OI change of future+options.Also OI intraday is not 100%reliable and its update EOD which is exact data. so its good to see change in OI rather whole OI.
  2. In theory OI is defined from sellers perspective but Practically its both Seller and buyers perceptive. so practically if Put OI increases and price action is downtrend its bearish sign( but in theory you may read otherwise). So don’t see max pain and OI from sellers perspective look from both buyers and sellers perspective both
  3. Look OI of particular expiry from last 3-5 days price action perspective and from Straddle/strangle perspective. Think of how people at large would be at particular point after they are adjusting. So when large OI is breached closer to the expiry then chances of one way move is stronger due to short covering of any options.

Elernmarkets Youtube channel has lots of great video explaining the OI in depth . Intraday Options Trading करने का एक दमदार तरीका। - YouTube ; क्या है सही तरीका Open Interest और Price को मिलाकर share trading करने का? - YouTube