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Written by Al Parsai
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Sunday, 01 February 2009 |
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Liquidity in Forex refers to the availability of a currency pair to trade. If the market is illiquid then you will not be able to purchase or sell your desired currency pair in a timely fashion or at the price you expect to buy or sell. One of the negative aspects of illiquidity is that you may not be able to exit a trade on time and therefore lose more and/or gain less. One other negative aspect of illiquidity is that the odds of stop hunting by brokers or rather market makers are higher.
Discuss this term!
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Last Updated ( Saturday, 21 February 2009 )
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