Identify the position of the stock and then trade eg-long and short positions.stoploss should be set .calucated risk is important for doing business saving ourself from loss.
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Hi,
Your Question 1:: Long unwinding and short covering?
Long Unwinding: Close out the position of Long, i.e Selling the stocks to exit the long position at a profit or loss.
The open interest will decrease if Long positions are sold off. The price will decrease and Open interest will also decrease. This signifies Long Liquidation or Long unwinding. Note Long Unwinding causes the prices to go down.
Short Covering: Short covering refers to the practice of purchasing securities to cover an open short position. To close out a position, a trader purchases the same number and type of shares that he sold short.
The open interest will decrease if the short positions are covered. The price will increase and open interest will decrease. This signifies Short covering. Note short-covering causes the prices to go up.