What is change in OI in an option chain?
Change in OI is the number of option contracts opened or closed at a strike during a period. A positive change means new positions were opened there; a negative change means positions were closed. It sits next to open interest in every option chain, and it is the column that tells you what is happening today rather than what built up over weeks.
Change in OI = current open interest minus open interest at the start of the period — the previous close in a daily chain, or the last few minutes on a live chart. Rising means traders are taking new positions at that strike; falling means they are closing them. It measures the direction of commitment, not of price.
- What open interest is
- What the change tells you that the total does not
- The four combinations of price and OI
- Reading it on calls and puts
- Change in OI vs volume
- Common mistakes
- See it live
What open interest is
Open interest is the total number of contracts at a strike that are currently open — not yet closed out or expired. It rises by one contract when a buyer and a seller both open a new position, and falls by one when both close.
Because every option has a buyer and a writer, open interest counts contracts outstanding, not traders. A strike showing 5,00,000 open interest has half a million contracts alive, with somebody on each side of every one.
What the change tells you that the total does not
Total open interest accumulates. A strike can carry a large number simply because it has been liquid for weeks, which says little about today. Change in OI is the flow — what was added or removed during the period you are looking at.
That is why traders watch the change intraday. A strike with modest total OI but a sharp increase in the last fifteen minutes is often more informative than the strike with the largest total.
The four combinations of price and OI
Change in OI only means something read alongside what the price did:
| Price | Open interest | Usual reading |
|---|---|---|
| Rising | Rising | Long build-up — new buyers entering with conviction |
| Falling | Rising | Short build-up — new writers entering, expecting price to stay below |
| Rising | Falling | Short covering — writers closing out, often sharply |
| Falling | Falling | Long unwinding — buyers giving up and closing |
These are conventions rather than laws, but they are the vocabulary Indian market commentary uses, so it helps to know them.
Reading it on calls and puts
The asymmetry that matters is who carries unlimited risk. A buyer risks only the premium paid. A writer takes open-ended risk for a fixed premium, so writers are usually better capitalised and more deliberate about where they sell. That makes writing activity the more informative signal:
- Put OI rising below spot — put writers need the index to stay above that strike. Read as support building.
- Call OI rising above spot — call writers need it to stay below. Resistance building.
- Put OI falling below spot — writers closing or being squeezed. Support weakening.
- Call OI falling above spot — writers covering, often as price approaches. Resistance easing.
The strike with the largest put addition below spot and the largest call addition above it often bracket the day's working range.
Change in OI vs volume
These are frequently confused. Volume counts every contract traded during the day, including the same contract changing hands repeatedly, and resets each morning. Open interest counts positions still outstanding, and carries over.
High volume with little change in OI means contracts were traded back and forth without new positions being created — intraday churn. High volume with a large OI increase means fresh money took a position. The second is the one worth noticing.
Common mistakes
On expiry, open interest collapses across all strikes because positions settle, not because anyone changed their view. The unwinding is mechanical.
Open interest falls when either side closes. Calls unwinding could mean writers covering ahead of a move up, or buyers giving up. Price direction tells you which.
Large changes at distant strikes are often spreads, hedges or rollovers rather than directional bets. Stay near the money.
Writers are wrong regularly. Heavy put writing tells you where support is being defended today, not that it will hold.
See it live
Most option chains show change in OI as a column of numbers, which makes the shape of the positioning hard to see. The OI change chart plots it strike by strike for NIFTY and SENSEX — green bars for puts, red for calls, with the spot price marked — so where writers are building support and resistance is visible at a glance rather than reconstructed from a table. The window switches from five minutes to the full day, and it updates through the session.
For the deeper version, including how to combine it with price levels, see how to read the OI change chart.