The number of open positions and the transaction volume are different concepts. The number of open positions refers to the contract between long and short parties with no relative power. Since the bitcoin perpetual contract is denominated in bitcoin or US dollars, it is not Like the Taiwan index futures, there is a unit concept of "one lot", and the open positions of perpetual contracts are mostly expressed in US dollars or BTC. for example: A is long 1 BTC, B is short 1 BTC, then OI = 2 BTC Opening a new position will increase OI, and closing a position will decrease OI, so roughly the relative relationship between price and OI is as follows: Price rise + OI rise = long position opening
The price rises + the OI falls = the short side closes the position Price falls + OI rises = short positions open Price drop + OI drop = long position closing We can also cite a few possible situations in more depth: The price fell sharply but the OI decreased ghost mannequin effect service by a relatively small amount: it may indicate that the decline will be won for a long time. The price fell slightly but the OI decreased by a relatively large margin: it may indicate that the decline has hit the bottom, and there is a chance to reverse the trend in the short term.
When the funding rate is positive and the OI increases substantially, but the price hardly changes: indicating that new multi-party forces are being absorbed continuously, the market may turn weak. When the funding rate is negative and the OI increases substantially, but the price hardly changes: it means that new bears are being absorbed and the market has a chance to strengthen. When the market breaks through the pressure price strongly, the OI increases, but when the market falls back to the old pressure, the OI does not decrease significantly: it means that many investors are trapped! How can perpetual contracts and funding rates be used for arbitrage strategies? That's another topic of discussion. source