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What is the Open Interest-Price relationship in commodity markets?

In commodity markets, the relationship between Open Interest and price movement is similarly indicative of trend strength. For example:

  • Rising OI and rising price indicates growing bullish sentiment.
  • Rising OI and falling price suggests increasing bearishness.
  • Decreasing OI and rising price may suggest a short squeeze or liquidation of positions.
  • Decreasing OI and falling price suggests weakening market interest.
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