TOP 5 most common mistakes of a crypto trader
Before traders become professionals, they go through a long process of trial and error. But there are mistakes that a trader needs to get rid of. What are they?
🔹 Use all the money
This is a big mistake, because you leave no room for maneuver, for example, if you need to average out the position after a price rollback or buy other promising cryptocurrencies.
Distribute some of the funds for buying cryptocurrencies, and leave some in reserve in case of unforeseen factors, for example, in case of a sharp collapse of rates.
🔹 Not diversifying risks
Investing in only one asset is a big mistake as well. Diversification is one of the fundamental rules of crypto trading. If you distribute money between several cryptocurrencies, then the losses from the fall in the price of one crypto asset can overlap the profit from the growth of other coins.
🔹 Trading without strategy
Chaotic trading is more like a gamble than actual trading. What should be done to avoid mistakes? To begin with, master the methods of fundamental and technical analysis; develop and test strategies, improve them, optimize them, add effective techniques, and eliminate unnecessary ones.
🔹 Emotional trading
Newbies easily succumb to greed and fear, which is why they regularly make mistakes in crypto trading. An experienced trader does not buy/sell everything at once. They leave a part of the sum in case of correction or growth in order to lock in profits and minimize losses.
🔹 Averaging out to cover losses
Those who have encountered gambling are familiar with such a situation when they want to quickly recoup. Traders must learn to trade on the exchange so as to correctly determine the direction of a trend.
It is too risky to average out positions during a downtrend, as the price may go even lower. It is better to wait for the signal when it is clear that the trend has changed direction and you can open positions with less risk. Only profitable trading, only Cryptology!