#OrderTypes101 Liquidity directly affects how easily assets can be bought or sold without causing significant price changes. High liquidity means faster order execution, which is ideal for traders.Low liquidity can lead to slippage, where trades are executed at less favorable prices.Evaluating liquidity before entering a position, traders assess metrics such as 24-hour trading volume, order book depth, and bid-ask spread on various exchanges. Reducing slippage, common strategies include using limit orders instead of market orders, trading during peak market hours, breaking large orders into smaller ones, and choosing trading pairs on high-liquidity exchanges.