Cryptocurrency trading offers high profit opportunities but also carries enormous risks. Many new and even experienced traders sometimes make basic mistakes that cause their accounts to 'evaporate' after just a few unfortunate trades. Let's analyze the 7 most harmful habits and how to overcome them so you can trade more professionally.

1️⃣ Excessive Leverage Abuse

  • Problem: Many exchanges allow leverage up to 50x, and even 100x. The higher the leverage, the smaller the margin required, but just a 1–2% price move against you can result in complete liquidation.

  • Consequence: Losing your entire account with just a small market move.

  • Detailed solution:

    • Limit leverage to around 2x–5x; with small capital, consider trading without leverage to get accustomed.

    • Always set Stop-Loss at 1–3% away from the entry point (depending on the project) for automatic loss cut.

    • Use Trailing Stop orders to 'smooth out' profit margins when prices perform well.

    • Conduct backtesting with a demo account before investing real capital.

2️⃣ Trading Based on Emotions

  • Problem: The fear of missing out (FOMO) leads you to buy at peaks or panic sell when prices drop. Constant emotional ups and downs lead to poor decisions.

  • Consequence: Losses stack up due to not adhering to discipline.

  • Detailed solution:

    • Build a trading plan including: profit targets, acceptable loss levels, and holding duration.

    • Use price alert tools instead of sitting and 'watching' the exchange constantly.

    • Apply the Journaling method: record all emotions, reasons for entering trades, and results to learn from experiences.

    • Establish the rule 'Do not enter trades when feeling overly fearful or greedy' and respect it.

3️⃣ Poor Security

  • Problem: A series of hacks and phishing emails causing investors to lose thousands of USD just for clicking the wrong link.

  • Consequence: Funds in hot wallets vanish, sometimes irretrievably.

  • Detailed solution:

    • Hardware Wallet: Ledger, Trezor... store private keys offline.

    • Two-factor authentication (2FA): Prioritize Google Authenticator, Authy instead of SMS.

    • Carefully check URLs, only access exchanges via bookmarks or by typing.

    • Regularly update wallet firmware, antivirus software, and do not install unidentified extensions.

4️⃣ Blindly Copying Trades

  • Problem: Trusting the 'tips' of influencers or Telegram groups without verification, leading to holding tokens that plummet in value.

  • Consequence: Holding bags, not knowing when to 'cut loss' or 'take profit'.

  • Detailed solution:

    • Tokenomics: Check total supply, burning mechanism, and project's vesting period.

    • Development team: Research the LinkedIn and GitHub of the founder and advisor.

    • Roadmap and milestones: How many important milestones has the project completed?

    • Real-world application: Does the token have usage in DeFi, NFTs, gaming... or is it just 'pump-and-dump'?

5️⃣ 'Revenge Trading'

  • Problem: Losing money and then increasing the position to... 'recoup'.

  • Consequence: Larger positions often move against you, causing the account to burn faster.

  • Detailed solution:

    • When losing 3 consecutive trades, stop immediately and take a break for 24–48 hours.

    • Apply the 1% Rule: each trade should only accept a maximum risk of 1% of total capital.

    • Practice Mindfulness techniques and breathing exercises to stabilize your mindset.

    • Reassess strategy: Do you need to adjust the timeframe, order size, or entry method?

6️⃣ No Specific Strategy

  • Problem: Entering trades when you 'feel like it', not following a system.

  • Consequence: Poor performance, results depend on luck.

  • Detailed solution:

    • Breakout Trading: Enter when the price breaks resistance or support with high volume.

    • Swing Trading: Hold positions from a few days to a few weeks, capitalizing on medium-term fluctuations.

    • Range Trading: Trade within a fixed range, buy low – sell high.

    • For each strategy, clearly define entry, exit, stop-loss, take-profit, and volume.

7️⃣ Buying on FOMO (Social Media Hype)

  • Problem: Viral tweets or videos about the 'next big thing' often cause you to jump in late, as prices have already surged.

  • Consequence: Buying at peaks, then witnessing prices adjust deeply by 20–50%.


    Detailed solution:

    • Track on-chain data: transaction volume, inflow/outflow, whale tracking.

    • Wait for the price to retest important support areas before entering.

    • Use RSI or MACD indicators to identify overbought areas.

    • Identify the break-even point and establish a strict cut-loss plan.

Conclusion

Cryptocurrency trading is not just about 'jumping in to buy and sell' but is an art that combines technical analysis, risk management, and steel discipline. Immediately eliminate the 7 mistakes above, build a clear trading roadmap for yourself, and maintain the habit of regularly reviewing your trading journal. Wishing you success and always preserving your capital.