#Liquidity101

💧 #Liquidity101

Liquidity is the pulse of the market! But what does liquidity mean in the world of trading and crypto? 🤔

🔹 Liquidity = The ease of buying or selling an asset without a significant change in price.

✅ High liquidity market:

• Faster execution

• Lower spreads

• Less volatility

⚠️ Low liquidity market:

• Difficulty in buying/selling quickly

• Large price differences

• Higher volatility risks

💱 Practical example:

Buying Bitcoin on Binance (high liquidity) is faster and easier than buying a small token on a decentralized exchange (low liquidity).

🎯 A smart trader always analyzes liquidity before entering a trade!