#Liquidity101

Liquidity is essential in cryptocurrency trading, as it allows entering and exiting the market without significantly affecting the price.

Before opening a position, I assess liquidity by observing:

✅ Daily trading volume

✅ The size of the spread (difference between buying and selling price)

✅ The historical depth of the order book

To reduce slippage, I use these strategies:

📊 Trade during high activity hours (such as when the U.S. and European markets overlap)

📉 Avoid pairs with low volume or high volatility

⚙️ Use limit orders instead of market orders