As discussed earlier, the open interest data is studied from option sellers’ perspective, because they are the traders/participants with deep pockets, as option selling involves taking unlimited risk and limited reward, i.e. restricted to option premium and also exchanges stipulate an initial margin requirement. With such a payoff structure, it suggests that they know the market better (probably) to assume a negative risk reward.
Now, when a large set of option traders write call option of a particular strike, making that as the single highest call from OI perspective. Then, that implies, traders are betting that prices of the underlying will not cross that stated level and this level develops as a single important technical resistance.
Similarly, puts are written at a single particular strike by option sellers, suggestive of an important technical support, as traders expect prices to hover above this level and not break this strike price.
This has been shown ahead in a template.