Why Liquidity Is Important in Forex Trading

Many Forex beginners often get confused about liquidity and volatility. Novice traders think that these terms are somewhat similar, but they are not. Approximately $6 trillion transactions are taking place every day in this largest financial market, and because of this huge transaction, this market is getting popular day by day. Both are important terms in this trading world. Volatility refers to the drastic change of the currency’s price, and liquidity is the activity of the market. It is evaluated by the number of active traders and the volume of trading. Since this platform remains open 24 hours, there are lots of placements and executions. The liquidity of the Forex business determines the degree of volatility. It means that if the volume of trade becomes higher, the volatility will

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