Part 11 Trading Masster Class

Role of Implied Volatility (IV) and Open Interest (OI)

Implied Volatility (IV): Indicates expected market volatility. Rising IV increases option premiums. Traders buy options during low IV and sell during high IV.

Open Interest (OI): Reflects the number of outstanding option contracts. Rising OI with price indicates strong trend confirmation, while divergence signals reversals.

These metrics help traders assess market sentiment and build informed positions.