#Liquidity101

Liquidity is a key concept every trader should understand. In simple terms, liquidity refers to how easily an asset can be bought or sold without causing significant price changes. High liquidity means there’s a large volume of buyers and sellers, making trades faster and more efficient. Low liquidity, on the other hand, can lead to slippage and volatility. Major cryptocurrencies like BTC and ETH usually have high liquidity, while smaller altcoins may not. Monitoring liquidity helps traders enter and exit positions smoothly, especially during market swings. It’s a vital factor for managing risk and executing effective strategies.

#Liquidity101