#firstdealofthenewyearFateema What are Liquidity Providers in Forex? Liquidity Providers are institutions or firms that provide liquidity to the Forex market by buying and selling currencies. Types of Liquidity Providers: 1. Banks: Major commercial and investment banks. 2. Institutional Investors: Hedge funds, pension funds, and insurance companies. 3. Market Makers: Firms that quote both buy and sell prices for currencies. 4. High-Frequency Trading (HFT) Firms: Companies that use algorithms to rapidly buy and sell currencies. Role: 1. Provide liquidity: Enable traders to buy and sell currencies quickly and efficiently. 2. Set market prices: Influence exchange rates through their buying and selling activities. 3. Manage risk: Hedge their own risk exposure through various trading strategies.