Shadowing Practice: YOU Are The Liquidity Smart Money Uses (Liquidity Trading Explained) - Learn English Speaking with YouTube
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Most traders are the liquidity that smart money uses.
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Most traders are the liquidity that smart money uses.
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That is exactly why you keep buying the top and selling the bottom.
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Let me show you what liquidity actually is and how to spot it before everyone else.
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So now, before we can start trading using liquidity and liquidity concepts,
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we of course need to answer the question, what is liquidity?
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And here, liquidity is one of these terms that can be hard to understand in the beginning,
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but I will try my very best to explain these terms in super simple terms.
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So in very simple terms,
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liquidity is simply how easy it is to buy or sell something quickly without moving the price.
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So one sort of way to think about this is,
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you know, if you look at this image right here,
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I try to really demonstrate the difference here between a sort of high liquidity,
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you know, in real life market and a low liquidity in real life market.
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So if we have a,
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for example, a farmer's market,
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right, like we have here to the right,
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you can see that we have many buyers and sellers that are buying and selling all the time.
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And because we have, you know,
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trading happening all the time.
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That means that the prices will stay around the same because of competition.
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So no one can come in here and sell,
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I don't know, tomatoes for $100 a piece.
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That doesn't really work because there will be other sellers that sell it for much less and so on and so on.
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And one big buyer can't really come in and buy everything in the market.
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So the price will stay much more stable and it will be easy to buy and sell stuff.
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But if we instead look at the image here to the right,
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this is what I try to show an example of a low liquidity market.
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So if we have, for example,
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an antique shop where we maybe only have one buyer and one seller at a time,
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this means that the price will,
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first of all, move much more slowly.
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We will have fewer transactions, right?
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But what it also means,
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and this is very important,
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is that if one buyer comes in,
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and let's say this buyer really wants this vase right here,
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he can actually affect the market himself.
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Maybe, you know, the seller realizes that he really wants the vase,
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and he can then, you know,
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increase the price of the vase and only sell it,
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you know, for higher prices.
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I hope this gets a little bit intuitive understanding of what high versus low liquidity.
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When you think about high liquidity,
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think about lots of buyers and sellers and that the price moves more smooth, like right here.
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And when you have low liquidity,
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think about less buyers and sellers and more,
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you know, they can affect the price more easily.
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So here, the more buyers and sellers there are at every price,
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the more liquidity and the smoother the price moves.
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So think about it like this.
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High liquidity equals price moves more smoothly.
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Low liquidity means price jumps in big chunks.
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And here, and this is very important,
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and you will learn about this throughout the course,
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most traders are the liquidity that smart money uses.
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So smart money traders are basically the big boys,
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the traders with lots of money like hedge funds,
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banks, and so on and so on.
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And we will talk about later on in this course how
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these traders can actually manipulate the price to take advantage of you and your liquidity.
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But for now, you don't need to worry about that too much
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because I want to jump into TradingView and show you an example of low versus high liquidity.
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Okay, so now we are in trading view and I actually have two charts up right here.
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On the left, you can see that we have the Bitcoin chart open
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and we are right now on a five minute time frame.
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So every candlestick represents five minutes of trading.
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And on the left here,
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I have a much smaller cryptocurrency known as JASMI.
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And we are also here on the five minute time frame.
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But the reason I chose these two charts right here is simple.
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this chart to the left is an example of a high liquidity chart
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while the chart here to the right is an example of oops a low liquidity chart
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and how can we see this well the first sign
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that I hope you can see let me make this chart a little bit bigger is
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that the price to the left here on the high liquidity chart is much more smooth.
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You can see here, every candlestick looks like a normal candle.
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You can see here to the left,
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all the candles looks normal.
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We have, you know, some candles with big bodies.
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We have some wicks right here,
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for example, a shooting star.
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But if you look at the low liquidity example,
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I hope you can see that the candlesticks looks like,
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you know, very ugly to put it blunt.
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You know, the candles are looking ugly.
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And what you will also see if we zoom in here is that you will see many candles that look,
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for example, something like this.
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You can see right here,
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we have two candles that are just lines.
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This right here is a classic example of very low liquidity
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because this means that during this time pretty much no trades were executed maybe a few trades
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but not enough trades to actually move the price
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so very low amount of trading and what you also can see is
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that we have these gaps when we have gaps on the five minute chart
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that is a clear warning sign that we're talking about low liquidity
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so this is a tip I can already give you guys that when you see a chart like this,
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when you have many ugly candles,
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you will have many candles without wicks, for example, right here.
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You will have many candles that are used lines, for example, right here.
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This is an indication of very low liquidity.
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And these markets are in general,
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both much harder to trade,
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but they are also much easier for people with lots of money to manipulate.
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So my tip here for most beginners is to really try to avoid low liquidity markets right here
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and focus on high liquidity markets when we have nice and smooth price action.
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All right, so now then,
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now let's take a look at this video.
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It was just a very short clip from our full liquidity trading course right here on YouTube.
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To access the full course,
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all you need to do is to click or tap on the screen right here.
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I hope to see you all over there very, very soon.
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About This Lesson
In this lesson, you will explore the concept of liquidity in trading and how it impacts market dynamics. By watching the video, you will gain a deeper understanding of the differences between high and low liquidity markets, as well as practical examples to illustrate these concepts. As part of your English language practice, you will focus on enhancing your speaking skills and improving your pronunciation by utilizing the shadowing technique.
Key Vocabulary & Phrases
- Liquidity: The ease of buying or selling something without affecting its price.
- High liquidity: A market condition where there are many buyers and sellers, resulting in stable prices.
- Low liquidity: A market condition with few buyers and sellers, leading to price volatility.
- Market dynamics: The forces that influence the behavior and prices in a market.
- Transactions: The act of buying or selling something.
- Price stability: A condition in which prices remain relatively constant over a period of time.
- Competition: The rivalry among sellers to attract buyers, which helps stabilize prices.
- Antique shop: A store that sells old or rare items, often characterized by low liquidity.
Practice Tips
To effectively use the shadowing technique with this video, focus on the speaker's pace and tone. The clear, engaging delivery will help you improve your English pronunciation. Here’s how you can use it:
- Play the video and listen to small sections; pause after a sentence or key phrase.
- Repeat the phrases out loud, trying to mimic the speaker's intonation and emphasis, which will enhance your shadow speech.
- Record yourself and listen to identify areas for improvement, making it easier to refine your pronunciation with each practice session.
- If you're using a shadowing app, utilize its features to match your speech with the video, allowing you to check your progress.
- Practice regularly; consistent shadowing will help you become more comfortable with trading vocabulary and speaking in English.
By incorporating these tips and focusing on key vocabulary, you will significantly enhance your speaking abilities while gaining insights into liquidity trading concepts.
What is the Shadowing Technique?
Shadowing is a science-backed language learning technique originally developed for professional interpreter training and popularized by polyglot Dr. Alexander Arguelles. The method is simple but powerful: you listen to native English audio and immediately repeat it out loud — like a shadow following the speaker with just a 1–2 second delay. Unlike passive listening or grammar drills, shadowing forces your brain and mouth muscles to simultaneously process and reproduce real speech patterns. Research shows it significantly improves pronunciation accuracy, intonation, rhythm, connected speech, listening comprehension, and speaking fluency — making it one of the most effective methods for IELTS Speaking preparation and real-world English communication.
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