Thin
a.k.a. Thin market, Thin liquidity, Illiquid
A market with few buyers and sellers active, so prices can jump on small orders and spreads widen.
In plain English
A market with few buyers and sellers active, so prices can jump on small orders and spreads widen.
A thin market is a quiet one. Fewer traders, fewer orders in the book, less liquidity. Think late Friday, holidays, or the hours between the New York close and Asia's open.
In a thin market, even modest orders can shove the price around, spreads widen, and sudden spikes (sometimes called flash crashes) become more likely. Many traders cut size or stay out when markets are thin.
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