Reading tech analysis bible from J. Murphy I came across with the concept of “Open interest”. It is applicable to Futures and Stocks, however there is no way to use open interest in Forex trading. Explanation in the book is too confusing and definitely not for entry-level reader…Can you provide more explicit with vivid example?
Thanks in advance.
Open interest is total number of contracts passed through exchange in some day. If you are advanced futures trader this information might be of help, because you can indirectly assess supply on demand on one or another actuals. But I trade mostly CFDs on hotforex, that’s why don’t think about that.
I don’t think you can make use of it on Forex as it’s very difficult to analysis this trillion market knowing number of deals bargained today