#Liquidity101

💧 #Liquidity101 – The Lifeblood of Markets 📊

Liquidity refers to how easily and quickly an asset can be bought or sold without significantly affecting its price. It’s a crucial concept in both traditional and crypto markets.

🔍 Types of Liquidity:

High Liquidity: Lots of buyers and sellers, tight bid-ask spreads, quick transactions (e.g., BTC, major stocks).

Low Liquidity: Fewer participants, wider spreads, price slippage, harder to execute trades (e.g., low-cap altcoins or penny stocks).

💼 Why Liquidity Matters:

🕒 Faster Trades – Enter or exit positions with ease

💵 Better Pricing – Smaller spreads = less cost

📉 Less Volatility – Prices stay more stable with more market participants

💡 Pro Tip: