Lower timeframes (5m - 30m): Useful for short-term scalping and identifying quick market shifts.
Higher timeframes (1h - 1d): Better for swing trading and spotting major trend reversals.

OI + Funding Rate: If OI is high and funding is positive, it means many traders are long, increasing the risk of a long squeeze.

OI + Long/Short Ratio: A high OI with a high long ratio could indicate a crowded long trade that might reverse.
Timeframe Consideration

A sudden OI spike with a rising price may indicate FOMO longs that could be squeezed.
A sharp drop in OI after a liquidation event suggests that overleveraged positions were wiped out.
Combining with Other Indicators ...

Price Down + Increasing OI: Bearish trend continuation (new short positions entering).
Price Down + Decreasing OI: Possible bullish reversal (shorts closing positions).
Tracking Liquidations and Squeezes

If OI rises rapidly, it can lead to a liquidity trap. For example: ...

Decreasing OI: Traders are closing positions, which can indicate a weakening trend or possible reversal.
Identifying Trend Reversals

Price Up + Increasing OI: Bullish trend continuation (new money entering).
Price Up + Decreasing OI: Possible reversal (short covering or profit-taking)...