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Author: Admin | 2025-04-28
Bitcoin, the spread tends to remain fairly low for the most part.What Is the Importance of the Bid-Ask Spread?With this information in mind, it is wise to keep an eye on the bid-ask spread for a number of reasons. First, as mentioned, it can give you an insight to how liquid the market is. The lower the spread is, the more liquidity there is. That means that there are multiple buy and sell offers. And, when there are many offers, there is greater competition, so you could encounter better prices.However, there are also situations where major crypto pairs have tight spreads. If that is the case, the bid-ask spread doesn’t really matter. On the other hand, newer and lesser-known assets could have large spreads, this makes it a lot harder for traders to identify sufficient entry prices. This may not be an issue if you are a long-term trader, however, if you are just seeking to earn from short-term trading, these are not ideal conditions.A general rule is to trade with a limit order if the bid-ask spread exceeds 1%. That way, you can get a desired price without ending up with a major loss. Alternatively, you could simply look up a different, more popular exchange. Assuming that it lists the asset you are interested in, it is popular that trading opportunities are more numerous.Does the Bid-Ask Spread Change in the Bitcoin Market?The simple answer is yes. The bid-ask spread in the Bitcoin market changes all the time and at
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