Volume and open interest (“OI”) are tricky subjects for most traders and because of this lack of understanding, they are often ignored. Since we are focused on Nadex binary options and spreads here, we should define open interest first then explain why in most cases, it should be left by the wayside when trading at Nadex. A common misconception of traders is that the OI of futures contracts is the same thing as volume in other securities, but it’s not. They are completely different. Take stocks for example. There are a finite number of shares for any given company available to trade in the equity markets. If you want to buy a stock, there has to be someone willing to sell the stock they already own, or the respective company has to issue more shares. Not in futures. Open interest represents the total number of contracts in existence at a given time and it is theoretically unlimited. You don’t have to own an S&P futures contract in the first place, in order to sell it. You do have to own a stock in order to sell it (unless you borrow someone’s stock to short it). Futures contracts are an agreement between 2 parties to settle a trade for cash at a given point in the future. So open interest serves the purpose of showing you the popularity of a particular contract at a given time. 
Having said that, OI is not very useful to short-term binary options traders, as it is generally reported next day, when most of your binary positions will have expired. Volume, on the other hand, can be useful. Futures exchanges report volume intraday and since Nadex binary options and spreads are based on high volume futures contracts, you can watch intraday volume and get some short-term insight.
So what insights? Well its more complicated than that, but in general:
Price up & volume up = bullish
Price up & volume down = bearish
Price down & volume up = bearish
Price down & volume down = bullish
Essentially, if intraday volume is increasing on up moves and decreasing on down moves, buyers are aggressive and additional moves to the upside will be more than likely. On the other hand, if volume is heavier on down moves, the market will likely continue lower. Volume is NOT a buy or sell signal by itself. if there is more volume behind what the technical price action is showing you based on chart patterns and price action, then those patterns are more valid. Remember you do not need record volume, you just need increasing relative volume. Even record volume by itself is not important. You must have volume and price movement. Two-way volume can produce huge numbers, but it is not a good indicator of anything.
Volume and open interest are often mentioned together, but for Nadex traders, volume is mustard. OI is ketchup. You HAVE to have mustard. Ketchup? eh….
Futures, options and swaps trading involve risk and may not be appropriate for all investors. Past performance is not necessarily indicative of future results
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