liquidity is the ability of an investor to trade a certain amount of assets at a reasonable price, fast or low cost according to the basic supply and demand conditions of the market. Only sufficient liquidity can allow traders to enter and exit the market at any time within 24 hours (working days). The foreign exchange market is the most liquid market in the world, and it is traded globally by a large number of retail investors and organizations. Therefore, the possibility of sudden flash or "market cracking" and other extreme phenomena in the foreign exchange market is relatively low.

what is the source of foreign exchange liquidity?

when some foreign exchange trading intermediaries such as foreign exchange brokers need to establish their own retail business, the first thing they need to do is to find a liquidity provider. For the foreign exchange market, the main source of liquidity is the big banks according to bis bank for International Settlements, About 70% of the liquidity in the foreign exchange market comes from the international banking giants, such as Huaqi bank, Deutsche Bank, HSBC, etc., which will provide quotations as the source of quotations, and then through LPS (liquidity Providers) liquidity suppliers integrate quotations to form an inter-bank foreign exchange trading market, and brokers can obtain liquidity from LPS in the inter-bank foreign exchange trading market, and then brokers provide liquidity to ordinary traders for trading. Therefore, if there is no liquidity, it means that the quotation source will not make a quotation, and the order will not be closed, then IB (Introduction broker) and individual traders will not be able to trade through brokers.