#TradingMistakes101 Common Trading Mistakes 101: What to Avoid in the Markets

Trading can be rewarding, but it's also full of pitfalls that can cost you time, money, and confidence. Here are some of the most common mistakes traders make—and how to avoid them:

1. Lack of a Clear Strategy

Jumping into trades without a plan is a recipe for inconsistency. Successful traders follow a strategy that outlines entry, exit, and risk management rules.

2. Ignoring Risk Management

Never risk more than you can afford to lose. Overleveraging or placing oversized trades can wipe out your capital quickly.

3. Letting Emotions Drive Decisions

Fear and greed are the enemies of rational trading. Stick to your plan and avoid impulsive decisions based on short-term price action.

4. Overtrading

More trades don't always mean more profit. Overtrading can lead to high transaction costs and emotional fatigue.

5. Revenge Trading

Trying to "win back" losses by making aggressive trades usually leads to even bigger losses. Take a break, assess what went wrong, and reset.

6. Neglecting Market Research

Failing to understand the market you’re trading in can lead to poor decisions. Stay informed with fundamental and technical analysis.

7. Not Keeping a Trading Journal

Without tracking your trades, it’s hard to improve. Document your trades to identify patterns, strengths, and areas for improvement.