#CEXvsDEX101

In the trading world, success is not measured by the number of trades you open but by your ability to stay in the market and manage risks wisely. Here are three common misconceptions among beginner traders and why they lead to inevitable losses:

1. The illusion of "capital recovery"

- Misbelief: "I'll just wait a little, and prices will return to where they were."

- Reality: Markets do not conform to your expectations, and the opposing trend can last for months. Holding onto a losing trade without a clear exit plan often leads to account depletion.

- Remedy: Using a stop loss is a necessary defensive tool, not a sign of weakness. Accepting a small loss is better than waiting for the unknown.

2. Overconfidence in instant predictions

- Misbelief: "This trade is guaranteed!"

- Reality: There are no guaranteed trades in the market. Even the strongest analyses remain probabilities. Making decisions based on emotion or haste can wipe out your capital in minutes.

- Remedy: Create a trading plan before entering the market that specifies your entry point, profit target, and stop loss. Be prepared for the possibility that the trade may fail.

3. Emotional drift in buying