Derivatives positioning and crowding.
| Concept | Explanation | |---|---| | Positive funding | Long traders generally pay shorts; long positioning may be crowded. | | Negative funding | Short traders generally pay longs; short positioning may be crowded. | | Open interest | Outstanding derivatives contracts that remain open. | | Open-interest spike | Rapid growth in leveraged participation. | | Long-short ratio | Compares reported long and short positioning. | | Positioning divergence | Price movement is not confirmed by positioning data. |
Rising price with rising open interest may indicate new leveraged participation. Rising price with falling open interest may reflect short covering. Interpretation depends on venue methodology and whether positions are opening or closing.