Liquidity

Liquidity refers to the ease with which an asset can be bought or sold without significantly affecting its price.

In trading, **liquidity pools** are areas where a large number of stop-loss orders are clustered. Big players (banks, institutions) often hunt these levels to fill their large orders.

Common liquidity areas: - Equal highs / equal lows - Previous day high / low - Round numbers (1.1000, 1950.00) - Above swing highs or below swing lows