#Liquidity101

"Liquidity refers to how easily an asset can be bought or sold without significantly affecting its price. In trading, liquidity is crucial as it ensures that positions can be entered and exited quickly. High liquidity means many buyers and sellers, tighter bid-ask spreads, and lower volatility. Low liquidity can lead to large price swings and difficulty executing trades. Traders and investors consider liquidity when making decisions, as it impacts their ability to buy or sell assets efficiently. Understanding liquidity is key to navigating markets effectively, especially in cryptocurrency and other volatile assets."