Trading cryptocurrencies can be exciting and profitable, but it's also full of pitfalls. Many beginners—and even seasoned traders—make critical errors that can cost them dearly. Here are some of the most common mistakes and how to avoid them, using BTC/ETH as an example.
1. Overleveraging: Using leverage might amplify gains, but it also magnifies losses. Many traders go all-in on BTC/ETH with 10x or even 50x leverage, only to get liquidated on small price swings. Always assess risk before using margin.
2. Ignoring Stop-Losses: Setting a stop-loss is vital to protect your capital. Without one, a bad trade on BTC/ETH can spiral into a huge loss if the market turns suddenly.
3. Emotional Trading: FOMO (fear of missing out) and panic selling are psychological traps. If BTC surges, don’t jump in without a plan. Likewise, if ETH crashes, don’t exit in fear. Stick to your strategy.
4. Lack of Research: Many traders blindly follow social media hype without analyzing charts or fundamentals. Always do your own research (DYOR) before trading any pair.
Avoid these mistakes, and you’ll be on the right path toward consistent, disciplined trading.