Trading Hell: You are forever trapped between taking profits too early and cutting losses too late
Last week, I stubbornly held onto unrealized losses without cutting losses, and ultimately had to sell at a 15% drop.
This scene plays out day after day in the crypto world, like Sisyphus pushing a stone uphill.
The devil is hidden in two phrases:
Taking profits off the table makes you only sip soup in a bull market
Opening the layout allows you to be devoured by the bear market down to the bones
The secret weapon of top traders is actually a math problem:
With a risk-reward ratio of 3:1, a win rate of only 34% is enough to break even
But ordinary people always chase 1:1 trades, needing a win rate of 50% to avoid losses
Before opening a position next time, try to interrogate yourself with the prisoner's dilemma:
If you set a stop loss at 5%, at least set a take profit at 15%
Let 6 out of 10 trades result in small losses, 3 breakeven, and 1 big gain
This is the only escape route through bull and bear markets
Unfortunately, most people would rather endlessly cycle between the joy of making 5% and the regret of losing 20%
Than endure the agony of holding a position.
The cruelest truth in the crypto world:
The candlestick chart is not a market trend
But an electrocardiogram of human weaknesses.
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