Change of OI is influenced by many ways
a) New seller creates a postion with a new buyer (OI added)
b) Existing buyer squares of with existing seller (OI decreases)
c) Existing buyer squares of with new seller (no change)
d) Existing seller squares of with existing buyer (OI decreases)
e) Existing seller squares of with new buyer (no change)
So a new position is created only when a new seller comes in.
There is a good example in one of blogs
Option trader,
The example posted by you is about OI. Its showing how OI changes.
Rule no.4 is not about volume and OI . Its Volume and Change in OI.
I don't see any way how change in current day OI can be greater than current day volume.
pls comment.
thanks.
a) New seller creates a postion with a new buyer (OI added)
b) Existing buyer squares of with existing seller (OI decreases)
c) Existing buyer squares of with new seller (no change)
d) Existing seller squares of with existing buyer (OI decreases)
e) Existing seller squares of with new buyer (no change)
So a new position is created only when a new seller comes in.
There is a good example in one of blogs
Option trader,
The example posted by you is about OI. Its showing how OI changes.
Rule no.4 is not about volume and OI . Its Volume and Change in OI.
I don't see any way how change in current day OI can be greater than current day volume.
pls comment.
thanks.