Does Concentrated Liquidity Increase or Decrease the Overall Pool’s Resistance to Large Trades (Slippage)?
Concentrated liquidity significantly increases the pool's resistance to large trades within the concentrated range, thereby decreasing slippage. By having more capital deployed near the current market price, the reserves are deeper in that specific area of the curve.
This means a large trade causes a smaller percentage change in the reserves within that range compared to a standard AMM with the same total TVL. However, slippage increases dramatically once the trade pushes the price outside the concentrated range.