when open interest is increasing
What Open Interest Tells Us. A contract has both a buyer and a seller, so the two market players combine to make one contract. The open interest position that is reported each day represents the increase or decrease in the number of contracts for that day, and it is shown as a positive or negative number.An increase in open interest along with an increase in price is said to confirm an upward trend.. If prices are rising and open interest is increasing at a rate faster than its five-year seasonal average, this is a bullish sign. More participants are entering the market, involving additional buying, and any purchases are generally aggressive in nature. 2.