How can i understand which stock is liquid and which is not?
look at the market depth & impact cost or bid ask spread for trading…
market depth shows u the highest buying price & lowest selling price
liquid stocks have low bid ask spread or difference between above 2 prices eg highest buyer is at 100, seller is at 100.1… this shows spread of 10 paise for market order which is very low and hence its liquid… but let say highest buyer is at 100, seller is at 120… this shows illiquidity at the spread is of 20% if executed at market order.
Normally liquid stocks have high volume
some of the eg. of very liquid stocks are ITC, ICICI bank, Tata Motors etc… (Dont consider these as recommendations please 
some of the illiquid stocks are MRF, eicher, page (these are very high tickets but less volume and high impact cost)
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It depends on average volume for me… Eg I may not trade a stock having 10 day average volume less than say 500000 if I m doing intraday trade but in case I want to invest or take positional trade I need not set such a stringent volume as said above and relax it to say 100000 but rather set emphasis on price at which I am acquiring… Set the limit order and execute while buy positional … That’s it
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