LECTURE

LIQUIDITY &
LIQUIDITY POOLS

Mentor: M JAVED
WHAT IS
LIQUIDITY
Liquidity describes the extent to which an
asset can be bought and sold quickly, and at
stable prices, and converted to cash.

Availability of Buyers and Sellers.

• High liquidity: A readily traded currency pair with a
large volume and frequent transactions. You can
enter and exit positions quickly and at the current
market price.

• Low liquidity: A less-traded pair with smaller

volume and infrequent transactions. Entering and
exiting positions might take longer, and the price
might be affected by your order.
 WHY

LIQUIDITY
MATTERS
• Impact on trading: High liquidity facilitates
smooth trading with tighter spreads and lower
transaction costs. Low liquidity can lead to wider
spreads and higher costs, making trading less
profitable.

• Price stability: Highly liquid pairs tend to be more

stable and less volatile as there are more buyers
and sellers to balance the market forces. Less
liquid pairs can be more volatile and
unpredictable.
EXAMPLES
• High liquidity: EUR/USD, USD/JPY,
GBP/USD. These pairs are traded by
millions of people worldwide and have
large volumes, making them ideal for
active traders.

• Low liquidity: USD/ZAR, EUR/TRY,

NZD/CAD. These pairs are traded by
fewer people and have smaller volumes,
making them less ideal for frequent
trading.
WHAT IS

LIQUIDITY
POOL
A liquidity pool is a concentrated zone
where a high volume of orders, especially
stops, limits, and pending orders, gather
around key support and resistance levels.
 THANK YOU
guys! Big thanks for diving into liquidity pools with me
today. Your questions and focus were like gold – truly
inspiring! Mastering these hidden currents is key to your
forex journey, and I can't wait to see you ride the waves to
success. Keep learning, keep trading, and keep pushing
yourselves! Remember, I'm always in your corner.

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