📊🚀EXAMPLE WITH $SOL
1. Open Interest Chart 📈
What is Open Interest?
Open interest is like the thermometer of the futures market. Shows how many contracts are active at the moment.
How to Read the Chart:
- 📏 Vertical Axis (#SOL ): Number of open contracts.
- ⏰ Horizontal Axis: Timeline.
- 🟨 Yellow Bars: Open interest in contracts.
- ⚪ White Line: Value in USD of the open interest.
Interpretation for Beginners:
- 📈 Rise: More people are entering the market. Something interesting is happening!
- 📉 Down: People are closing positions. It can be due to profit or loss taking.
TIP
A sudden increase in open interest coupled with a strong price movement can signal the start of a new trend.
2. Average of Top Traders in Long/Short (Accounts) 🏆
What is this?
This graph shows you what the "big fish" in the market are doing. Are you betting on the price going up or down?
How to Read It:
- 📊 Vertical Axis: Percentage of accounts in long or short.
- ⏰ Horizontal Axis: Timeline.
- 🟥 Red: Percentage in short (they bet on the downside).
- 🟩 Green: Percentage in long (they bet on the upside).
- ⚫ Black Line: Average long/short ratio.
Interpretation:
- 🟩 Greener: The big ones believe that the price is going to rise.
- 🟥 More Red: The big ones believe that the price is going to go down.
Trading Tip:
If you see that the majority is in one direction, but the price is going in the opposite, it could be an entry opportunity.
How to Use This Info in Your Trading 🧠
1. Look at Open Interest:
- 📈 Rising + Price Rising = Strong bullish trend.
- 📉 Falling + Price Falling = Strong bearish trend.
2. Check out what the Top Traders do:
- If they go against the current trend, a change could come.
3. Combines both graphics:
- High Open Interest + Mostly Long Top Traders = Possible bullish rally.
- High Open Interest + Mostly Short Top Traders = Possible sharp drop.
Practical Example 🎯
Imagine you see:
- Open Interest rising rapidly.
- Top Traders going from majority short to long.
- Price starting to rise.
This could signal the start of a strong bullish movement. You could consider a long entry, but always with a stop loss!
Newbie Warning ⚠️ (me haha)
These graphs are useful, but they are not a crystal ball. Use them in conjunction with other tools and never invest more than you can afford to lose.
Ready to put this knowledge into practice? Trade wisely! 🧠💼
ALWAYS WITH BNB FOR THE COMMISSIONS! $BNB #NEWUSER #BINANCE #WRITE2LEARN
If you liked it, I appreciate you sharing it, thank you!🙏✨
