Chapters in Derivatives & Options Flow
Chapter 2 of 5 · 5 min read
Open interest, PCR and positioning
Read what traders are holding, not just what they traded.
Open interest (OI) is the number of outstanding contracts. Rising OI with rising price suggests fresh long positions; rising OI with falling price suggests fresh shorts. Falling OI means positions are being closed.
Put-call ratio (PCR)
PCR divides put OI (or volume) by call OI. Very high PCR can reflect heavy hedging or bearishness; very low PCR can reflect complacency. It is often used as a contrarian gauge at extremes.
Max pain and OI walls
Strikes with large call OI act as resistance and large put OI as support in practice, particularly near expiry. These are tendencies, not guarantees.
Key takeaways
- OI + price together tell you who is entering.
- PCR is a sentiment gauge, strongest at extremes.
- OI walls shape expiry-week behaviour.
Put it into practice
Open the live page on Market Intelligence and see this concept on real data.
Keep learning
- Reading an option chain and the Greeks · Derivatives & Options Flow
Education only, not investment advice. Updated 2026-10-09.