#Liquidity101

liquidity is crucial for traders. Simply put, liquidity measures how easily you can buy or sell an asset without significantly impacting its price. When liquidity is high, there are many buyers and sellers, making trades quicker and more efficient. Conversely, low liquidity can cause slippage and price volatility.

Typically, major cryptocurrencies like Bitcoin (BTC) and Ethereum (ETH) have high liquidity, while smaller altcoins may struggle with lower liquidity. Keeping an eye on liquidity helps traders smoothly enter and exit positions, especially during market fluctuations. It's a key factor in managing risk and executing successful trading strategies.