Been trading for a while now and keep seeing traders argue about which matters more.
Some say volume shows the real action happening right now. Others think open interest gives better insight into where things might go.
Personally I’ve had mixed results using both. Sometimes high volume worked out, other times it didn’t mean much.
What do you think actually matters more when making decisions?
Honestly, this argument cost me $300 when I overthought a EUR/USD trade last month.
I had perfect volume confirmation but ignored that open interest was dropping fast. The move reversed within hours.
Now I check both but weight them based on my trade duration. Quick scalps need volume validation. Longer positions require open interest backing.
The debate comes down to timeframe really. For short term moves, volume matters way more because it shows actual buying and selling pressure happening.
Open interest is better for understanding longer term sentiment and whether a trend has legs. But when trading on mobile with limited time to analyze, volume gives quicker signals.
My approach is checking volume first for entry points, then looking at open interest to see if the position has staying power.
Volume is key for entry timing. It shows where the real action is. Open interest can indicate potential support but doesn’t help with timing. Use volume to confirm breakouts and see when big money enters. High volume on a move usually means it will continue. Open interest helps to grasp if a trend is strong, but always prioritize volume for making trades.
Both serve different purposes:
• Volume - confirms price movements
• Open interest - shows market sentiment depth
Combine them. Volume validates entries. Open interest indicates position strength. Neither works alone consistently.
Volume shows current trading action. Open interest hints at future trends.