What are the implications of abnormally high Open Interest on FYERS charts?
Abnormally high Open Interest on FYERS charts can be a significant indicator of increased market leverage and potential volatility. Such conditions often suggest that:
High Leverage: A large number of traders have taken positions, which can amplify price movements as these positions might be leveraged.
Potential Volatility: High OI indicates that any significant news or market event could result in sharp price movements, as traders react swiftly to new information, adjusting or closing their positions.
Traders should approach these conditions with caution, considering them in their risk management strategies and watching for signs of market reversal or acceleration.