Introduction: The shocking truth behind the failure of most traders.
Did you know that 90% of traders in the cryptocurrency market lose their money? This figure may seem shocking, but it is a reality experienced by most who enter this market without adequate preparation. Is the reason market volatility, or human errors that can be avoided? The truth is that most failures stem from poor decisions, not the market itself.
In this article, we will expose the deadly mistakes that destroy trading accounts, and we will show how to avoid them in a practical way that ensures you remain among the 10% successful.
1. Lack of a clear trading plan.
Problem: Many traders enter the market based on emotion or excitement without having a clear plan. They buy when prices rise out of fear of 'missing out' and sell when prices fall due to panic.
Solution:
Define your strategy before entering any trade.
Set clear goals for profit-taking and stop-loss.
Stick to the plan regardless of your momentary feelings.
Practical example:
Let's assume you decided to enter a buy trade for coin 'X' at a price of $100. You should predefine:
Profit-taking point (for example, at 120).
BTC70,042+5.70%.
Stop-loss point (for example, at 90).
BNB655.18+0.81%Risk-to-reward ratio.
2. Overtrading.
Problem: Some traders believe that trading all day increases profits, but the opposite is true. Too many trades lead to rash decisions and increased commissions and losses.
Solution:
Focus on quality, not quantity.
Do not enter trades unless there are strong signals available.
Use strategies like 'patient trading' instead of random trading.
Example:
If you make 5% from one reliable trade in a week, that is better than losing 10% due to 10 hasty trades.
3. Not managing risk properly.
Problem: Entering trades without defining risk size leads to significant losses. Some bet all their capital on a single trade, exposing them to bankruptcy in an instant.
Solution:
Do not risk more than 1-3% of your capital on a single trade.
Always use a stop loss.
Distribute capital across multiple trades to reduce risk.
Practical example:
If you have $10,000, do not put more than $300 in a single trade even if you are confident in it.
4. Being swayed by emotions: fear and greed.
Problem: Greed makes traders hold onto a trade for too long, while fear makes them sell quickly at the first slight drop. These emotions are the number one enemy of any trader.
Solution:
Rely on data and technical analysis instead of emotion.
Use strategies like 'partial profit-taking' to secure part of the profit while the trade continues.
Remember that the market always provides new opportunities.
Example:
If you make a 50% profit on a trade, you can sell 50% of the amount and keep the rest, instead of risking losing everything.
5. Ignoring technical and fundamental analysis.
Problem: Some rely solely on recommendations or news without understanding technical or fundamental analysis. This makes them prone to making uninformed decisions.
Solution:
Learn how to read charts and technical indicators like RSI and MACD.
Follow economic news and regulatory updates that affect the market.
Combine technical and fundamental analysis for more accurate decision-making.
Practical example:
When you see that Bitcoin's price is at a strong resistance zone in technical analysis, but there is strong positive news like government approval of a new ETF, you can expect a breakout of this resistance.
6. Not learning from mistakes.
Problem: Some traders repeat the same mistakes without reviewing their performance or improving their strategies.
Solution:
Keep a trading journal to document each trade, the reasons for entry and exit, and the results.
Review your past trades to see what worked and what failed.
Continue learning through training courses and following experts.
Example:
If you notice that you are losing in overnight trades due to unexpected volatility, it may be better to avoid trading during those periods.
Conclusion: How to become one of the 10% successful?
Success in the cryptocurrency market is not luck; it is the result of planning, discipline, and risk management. If you avoid these deadly mistakes and equip yourself with the right knowledge and tools, you will be able to improve your performance and stay in the market for a long time.
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