7 biggest mistakes that new traders make| List of new traders’ crimes that killed people have made a new account and bought your first Bitcoin so far. Now you are ready to start trading in cryptocurrencies. You often trade on an exchange where the first coin you buy goes up in price by 10% before you sell it.
Things were going so well until you did one of these rookie mistakes.
1 – Waiting for Pump and Dump
If a trader buys at the bottom, one of the most beautiful things they can see is a green candle that shoots up into the sky. But without a horse to race, envy could be too much to handle. You will have lapsed profit syndrome and try to bet all of your money.
Sometimes it will pay off, but most of the time it will just get you into trouble.
A pump-and-dump scam doesn’t always happen when the price of a cryptocurrency changes quickly. Exponential growth could also be caused by good news or the promotion of a powerful person. Before you buy a coin, you need to understand why its value is going up.
If not, you risk failure. Many new cryptocurrency traders try out “pump-and-dump” companies that promise quick profits with little work. Failure once or twice will be enough to teach you a lesson and help you find smarter ways to trade.
2 – Buying in illiquid markets
For the value of your coin to keep going up, someone else must want to buy it. The problem with a lot of new altcoins and a lot of small exchanges is that they don’t get enough orders. You can be sure that Sprouts (SPRTS) is the future of crypto, but if enough traders disagree, you risk focusing on a currency that no one wants to buy, or at least not at a price you’re willing to pay.
There is nothing wrong with investing for the long term in a coin whose basics you trust. But these “undiscovered diamonds” often don’t have enough cash on hand in the short term. Traders who are tired of waiting for the price of a coin to go up may be forced to sell at a price much lower than what they want.
Read: 10 rules to follow when investing
3: You set the wrong price
Raise your hand If you ever forgot a zero when setting up a trade and your coins went up, lower your sell order by 10 times.
This is easy to do with altcoins that are priced in fractions of Bitcoin: you think you’re making an order to sell 0.0000457 BTC, but you’ve actually made an order to sell 0.00000457 BTC. Most exchanges will go all the way up to the maximum rate.
But some services, such as Etherdelta, are not as easy to use as others. Before you press the execute button, you should always check the buy or sell price again.
4 – Putting the wrong coin in the wallet of an exchange or using the wrong chain
If you sent Bitcoin Cash to a Bitcoin wallet by mistake, the exchange won’t help you get it back. But it’s unlikely that the larger exchanges will help.
You should be careful before sending money to the wallet because mistakes are almost impossible to fix. Sending Ethereum tokens to an Ethereum exchange wallet or asking for a payout from a mining pool to go straight to an exchange wallet are also common mistakes made by beginners. Do not do that. The more you want to trade, the better you will get at it.
5 – Revenge of trader
You are upset because you didn’t buy a coin at the last minute and it went to the moon. Or you bought a useless certificate that was a sure loser and it didn’t work.
You are so angry that you put all of your money on the next green coin and try to ride this train to Profitville. When you do this, you overestimate what you can do and go into a market you haven’t tried before.
Where do you get into the market and get out of it? Why is the coin getting more valuable? You are stupid because you do things based on how you feel. Revenge trading is like catching your partner in the arms of someone else and then taking the first thing you find.
It will end in tears nine times out of ten. The more you can keep your feelings out of your business, the more successful you will be.
6 – Too much to do
Too many cooks will ruin the soup, and too many traders will cut into your profits. It’s easy to fall into this trap, and every new trader does it.
Check the day after you buy a coin to see if its value has gone up by 20%. Wouldn’t it be better to sell and make money? Not required As the saying goes, cut off your losses and let your winners run.
Selling assets just to make money is a basic trading strategy that can keep you from getting some of your best rewards. Nothing is worse than selling a coin for a small profit only to find out that someone else bought it for 10 times as much.
Also, doing too much for too little money will lead to an increase in the number of assets that are saved through exchange costs.
In some ways, being very busy and making small amounts of money is good, but these earnings will be eaten up by commissions on any exchange. You already know what will happen.
A week after buying a coin, its value may quadruple. Another coin does the same thing. Amazing. Manly. Touching everything makes it gold. Bravery determines your next move, which may seem like flying to the moon. All is lost. What happened? You’re also rude.
Self-confidence helps. It allows traders to think independently. However, overconfidence is dangerous. ignoring warning flags because you think you’re safe.
Despite avoiding these seven catastrophic blunders, you are not a professional trader. Watching two monitors and making charts takes years of experience. If you avoid beginner mistakes, you may become a pro.
Top 7 trading mistakes
- Misresearching markets.
- Unplanned trading.
- Software overuse.
- Neglecting losses.
- Over diversification.
- misunderstanding leverage.
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