Screens flag contracts where volume exceeds open-interest by a wide multiple, since that guarantees new positions. The logic is that someone with a view and conviction is expressing it in a place where the exposure is cheap and leveraged.
The evidence for this as a standalone edge is thin. Most flagged prints turn out to be hedges, spread legs, rolls, or market makers laying off risk, and the subset that reflects genuine information is not separable in real time. Treat an alert as the beginning of research, not the conclusion.
Example: XYZ $57.50 calls with 40 open interest trade 6,000 contracts. The alert fires. The same session shows 6,000 shares-equivalent of stock sold by the same firm — it was a buy-write unwind, and the bullish interpretation was backwards.
Related: options-flow, volume-open-interest-ratio, options-sweep, open-interest-change