Hunter KillerCreate free accountWhat is open interest?
Open interest (OI) is the number of futures contracts currently open, not yet closed or settled. It measures how much money is positioned in the market right now, and its changes tell you whether new money is arriving or positions are closing.
Open interest in plain terms
Every futures contract needs a buyer and a seller. When a new pair opens a position, OI rises by one contract; when an existing pair closes, OI falls. A trade between two existing holders leaves OI unchanged.
So OI answers a question volume cannot: is the market building positions or unwinding them?
- OI rising + price rising → new longs entering (fresh conviction, trend support).
- OI rising + price falling → new shorts entering (fresh downside pressure).
- OI falling → positions closing or being liquidated (the move is running out of fuel).
A worked example
Suppose BTC trades at $100,000 with 50,000 contracts open:
10:15, OI 52,000 · price $100,400 → +2,000 new contracts as price rose: fresh longs
10:30, OI 49,000 · price $99,800 → 3,000 contracts closed into the dip: longs exiting
Read: the up-move had new money behind it; the dip came with positions closing, not new shorts.
The same price moves mean different things depending on what OI did. That is the whole skill.
Figures are illustrative teaching numbers, not market data.
OI vs volume, and why OI near liquidation levels matters
Volume counts contracts traded; OI counts contracts still open. High volume with flat OI is churn (positions changing hands). Rising OI is new risk being taken on.
When OI builds quickly near obvious levels, the market gets crowded, and crowded positions are what cascades feed on. Watching OI build into a level tells you how much fuel sits there before it breaks.
See the Money Map, 2 hours behind
Hunter Killer tracks OI changes across venues beside the liquidation map, so you can see positioning build before it unwinds.
Educational content, not investment advice. Derivatives trading carries substantial risk.
Common questions
What does open interest tell you?
Whether positions are being built or closed. Rising OI with a price move means new money supports it; falling OI means the move is driven by closing positions and is more likely to stall.
Is high open interest bullish or bearish?
Neither by itself. High OI just means a lot of open risk. Direction comes from combining OI with price: rising OI + rising price leans long-heavy; rising OI + falling price leans short-heavy.
What is the difference between open interest and volume?
Volume counts every contract traded in a period. Open interest counts contracts still open right now. A market can have huge volume and flat OI (churn) or quiet volume with rising OI (quiet position-building).
Why does open interest drop sharply during liquidations?
A liquidation force-closes a position, removing it from OI. A cascade can sharply reduce OI within minutes as positions close.
Keep going with the other free tools
- Liquidation price calculator: see exactly where leverage force-closes this position
- Crypto P&L calculator: net P&L, ROE and breakeven after fees and funding
- Position size calculator: size any trade from your stop, not your leverage
- Kelly criterion calculator: turn a measured edge into an optimal stake
- Funding rate calculator: what perpetual funding costs or earns over the life of a position
- Liquidation heatmap explained: how to read the clusters and spot a cascade path
- Coinglass alternative: compare research tools and inspect the public record, misses included
- Liquidation map for TradingView users: measured levels beside your TV charts
- Hyblock alternative: the honest side-by-side with the orderflow analytics suite
- Money Map: estimated liquidation concentrations in dollars, 2 hours behind
Guides from the library
Educational material, not financial advice. Trading perpetual futures carries a real risk of total loss.
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