Glossary
Liquidity
How easily an asset can be bought or sold quickly without moving its price much.
A market with good liquidity has many buyers and sellers, orders resting close to the current price and steady trading volume. Large orders can be filled without pushing the price far.
Common signs are a narrow bid-ask spread and a deep order book. Thin markets show the opposite: wide spreads and big price jumps on relatively small trades.
Liquidity changes over time. It is often thinner outside main trading hours, on weekends in crypto and around major news, which is when slippage tends to be larger.
Related terms
For education only, not financial advice. Crypto assets and stocks are volatile, and leveraged positions can lose more than the money you put in.