OI-Price Correlation

Rolling OI-vs-price correlation.

What is OI-Price Correlation?

OI-Price Correlation is the 20-period rolling correlation between open interest changes and price changes. Positive values mean OI and price move together (confirming); negative means they diverge.

Parameters (20)

  • X-Axis: Time (funding rate intervals)
  • Y-Axis: Correlation (-1 to +1)
  • Line: Rolling correlation trend

Interpretation

  • Confirming: > 0.3 — OI and price moving together; validates the current trend
  • Ambiguous: -0.3 to 0.3 — no clear relationship
  • Diverging: < -0.3 — OI and price moving apart; warns of potential reversal
  • Transitions between zones are key signals
  • Data is very sparse — only ~24 data points total

Trading Signals

  • Correlation above +0.3 = open interest confirms the trend
  • Below -0.3 = OI diverging — unwind-driven move, fragile
  • Crossing zero = transition, wait for confirmation

Price Overlay

  • Close Price: Daily closing price (right Y-axis)
  • Correlation > 0.3 + rising price = OI confirming the uptrend
  • Correlation < -0.3 + falling price = OI diverging, potential reversal
  • Correlation flip near price extreme = regime change signal

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