🇬🇧 Liquidity in Crypto Trading

Liquidity refers to how easily an asset can be bought or sold without significantly affecting its price. High liquidity means smoother trades, while low liquidity increases volatility and risk.

🔹 Why it matters:

High liquidity: Tight spreads, fast execution, less slippage.

Low liquidity: Wide spreads, higher slippage, harder to enter or exit.

💡 Example:

Bitcoin (BTC) has high liquidity on Binance. You can trade millions without big price changes.

A small altcoin with low liquidity might drop 10% just because someone sold $50,000 worth.

Traders should always check trading volume and order book depth before entering a position.

📚 Sources:

Binance Academy – What is Liquidity?

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🔍 This is information, not financial advice. Always manage risk.

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