Topic: Mistakes to watch out for (Read 698 times)

You can agree with me that some mistakes are inevitable, especially when you're not aware of something related to occur, they comes in as a result of what we do, we can try out our best in making sure that we deal with this by taking it to the minimal level, because some may actually cost us than we expect, but when we know what we are doing, we will always ensure we avoid having any kinds due to our own carelessness in what we do.

how can you be calm, some traders may panic and lose again.
My mistake was when I took short and then the price went up and at that time I closed my short position, then I went long and after that the market reversed down.
I really hate being in that position and usually I will spend the capital I brought that day because my mind is carried away by emotions, where I should stop for a moment.

One of the mistakes I do is to trade when a coin has increased significantly in price. If it has increased, I go on short position. This is also what I do if the market price of a coin has decreased significantly, I go long. The mistake is that the market will continue in the direction and no reversal sometimes.  I later used averaging with it and I gain than before but it is very risky.

Their are few mistakes we trader make even when we already knows the craft but we still fall victim to, which are;

-  Trading against the trend: when trading against a trend their is a higher possibilities of you losing that trade, if you spot an uptrend, you should only be looking for a buy opportunities and if you spot a down trend you should only be looking for a sell opportunities simple, you get more winning trade by doing that.

- Too much monitoring of the chart: before you place any trades use a margin you can afford to lose, so that once you place your trade, you set your exit point, take profit or stop loss you wouldn't be checking your chart steadily, because by doing so, you emotions will come into play if it's a margin you can't afford to lose, try as much as possible to trust your analysis, leave it to play out if you want to make good money from the market if it's going your way.

- Entry point - most skill traders I have encountered struggle on this aspect, your entry point determine your risk to reward ratio and that is what keeps you profitable.
if you can get a good entry point by letting the market come too you, even though you loss 60% of your trades, you will still be profitable because 1-3 risk reward ratio will be the least you will get from such entry.

- Too much emphasis on technical indicators: most indicators mostly shows the past data of what have happened in the market, but wouldn't show you what is coming next, that's why it's very important to look at the price action of the chart, you react only to what the market gives you, not by doing what you think.
if you must succeed in trading you must start learning to react to what the market is playing out.

- Always calculate your loss before profit: when you trade with what you can afford to lose, it is near impossible for your emotions not to be in check.

- Avoid trading consolidation: traders that fall victim to this one are people that takes many trades, trading consolidation is very dangerous because it can go anyway, at such point, the market have no clear direction.

I think the follower number and the influence they have over people makes them earn more money than what they could in any other way. I think that's a very big shame because the same amount of work could make you a great trader that could make a lot of profit as well. Lets assume that I start today, if I work really hard maybe I can have like 100k followers in a year right?

I mean I probably can't, but I think that's a good example, then I make money from those 100k people slowly and hope that I will not be found out as a fake, whereas if I start today and work for a whole year to learn about trading, I would be able to trade and make money forever, literally until I die, and would not need anything to worry about neither. Influencers worry about everything, like if social media goes down, if their account gets blocked, if they do this or that, constantly living in fear and that's an issue. Whereas, if we are talking about a great trader, he could make money with anything.

since the social media platform is a trend, most crypto influencers are also deceivers. Sometimes I don't understand them all, but most of them are really just for the views.

The others also pretend to be experts who know a lot about cryptocurrency, but if you know something and you listen, there are also many mistakes in what is said in the video content that they also do, so the result is that the newbies who know nothing about cryptocurrency are misled or deceived. So it's still a good idea to do your own cryptocurrency studies. This is exactly what those planning to enter the crypto space should do.

Monitoring must be done in trading, but there are many types of traders who have their own methods, there are traders who are successful by placing pending orders after analyzing, and don't forget to place targets and stop losses, the rest they just need to monitor market movements once in a while and can carry out other activities. Of course, this will happen between making a profit or hitting the stop loss, and we can use the final result as material for correction

Perhaps, they should know first the consequences of trading without sufficient knowledge. Sadly, with the influence of social media influencers pretending experts in trading, most newbies fall into traps.

We all come from newbies but this time with so many tutorials and advice, it was easy for newcomers to learn which will make them not totally newbies when they start trading. But what it makes difficult for them is to adapt to the situation and understand the behavior of the market. And most of all, the struggle to handle their emotions when crisis comes.

Yeah, entry and exit points are crucial for trading. I usually short when the market has sunk and long when the price is just continuously pumping because at some point, it will get corrected at least by a small margin.

I am still working on a few things:

1- Trying not to buy memecoins because as lucrative as they are, I haven't had any great experience yet.

2- Smaller profits are better than an emotional loss. Like if I miss out on a $100 profit and it moves down, I am likely to hold for too long and might end up in a loss. So I am building the mentality to accept $50 profit and move on.

3- Not every time I have to trade and this has been an issue for a long time.

One of the mistakes I do is to trade when a coin has increased significantly in price. If it has increased, I go on short position. This is also what I do if the market price of a coin has decreased significantly, I go long. The mistake is that the market will continue in the direction and no reversal sometimes.  I later used averaging with it and I gain than before but it is very risky.

I blew several accounts during my early beginning in trading because of this,  FOMO in when the markets has already gone up without waiting and the worst of it is that the market usually pulls back to that point I initially set my entry. This is an issue most traders face and not basically that they are novice traders even some experience traders do this and this is because of emotion and high uncertainty in the market that at some point we don't want to miss out on some trades.

I think this is more or less FOMO type of trading. One does this when they think if price has gone up then it may go up more so I must go and invest now so that if price goes even up then we might profit. But that's not how it works. To be honest if prices has risen for coins then they are already in the risk zone. There is nothing logical in investing coins that are hot already.

Peeps shall start buying coins when they are already inbred zone. Somehow it's uncontrolled purchases that are done during such FOMO period.

-snip-
However, as they consistently trade and end up losing, they slowly realized that trading all-in do not fit in trading, or if ever if it works, only those professional traders are able to succeed on it and not those newbies in the market.

We need to admit that sometimes the volatility that exists in this market is simply too much, and even experimented traders will find themselves doubting themselves if the market crashed unexpectedly and they were losing money at a rate they did not expect.

So as way to reduce that anxiety you could reduce the size of the positions that you open, as in this way even if the volatility was high, your losses will not be as significant as before and it will be easier for you to hold your coins.

Not most or the majority of traders, but only novice traders who do not understand how to do good management and do not fully understand about crypto trading.

They are only dominated by the desire to win and end up being too greedy.
They keep putting money in and always buy, but when the highest target is reached, they don't sell it and hold it because they hope to get more profit.
This would be a perfect trap because they would panic when the price kept falling and eventually sell at a price below the first purchase and only get a loss.

One of the mistakes I do is to trade when a coin has increased significantly in price. If it has increased, I go on short position. This is also what I do if the market price of a coin has decreased significantly, I go long. The mistake is that the market will continue in the direction and no reversal sometimes.  I later used averaging with it and I gain than before but it is very risky.

or you can try the multiples theory, if the prediction you choose is wrong, you open a position opposite to the entry 2 times the previous one.
Of course this has risks, but the chance is the same, 50:50.