One of the most common trading strategy mistakes is the failure to stick to a plan. Many traders get caught up in the excitement of market movements and end up making impulsive decisions. This can lead to significant losses, especially when emotions like fear or greed take over.
It’s crucial to have a clear trading plan that includes risk management, defined entry and exit points, and a strategy to handle volatility. Another mistake is over-leveraging, which can amplify both gains and losses. Traders often underestimate the risks, leading to substantial losses when the market moves against them.
Don’t let emotions cloud your judgment, and always trade with a well-thought-out plan. It’s better to miss an opportunity than to risk your entire portfolio on a hunch.