As the market warms up, a large number of newcomers are starting to rush in, but you need to know:

Before the bull market arrives, the real test has just begun.

I've been in the crypto space for 8 years, and I've seen too many people get liquidated and leave during the first wave of price increases. This article is for newcomers, listing 5 pitfalls I've encountered, so you can avoid them and pay less tuition!

❌ Pitfall 1: Chasing when prices rise, panicking when prices fall, that's the essence of a retail trader.

Case: A certain meme coin surged 100 times from the floor price, trending on hot searches, countless people rushed in, resulting in a halving and further halving, and now they are still stuck.

The truth: You didn't miss the opportunity; you are standing on the baton of 'others running away.'

✅ Correct posture:

• If you see a surge, stay calm for 24 hours, don't let emotions dictate your actions;

• Market opportunities are infinite, but your principal is only once.

❌ Pitfall 2: Going all in, becoming a gambler.

Data: From 2020 to 2023, over 80% of altcoins went to zero, leaving only a few mainstream coins and leading projects.

You think going all in can turn things around, but in fact, you are flipping a coin to decide your fate.

✅ Correct posture:

• Use the '5-3-2 strategy' to allocate your positions:

• 50% allocate to mainstream coins (BTC/ETH)

• 30% allocate to popular sectors (Layer2, AI, Depin, etc.)

• Only 20% should be used to gamble on ultra-high-risk projects.

• Diversification is a lifesaver, don't let a single coin ruin your entire life.

❌ Pitfall 3: Ignoring asset security, once hacked, everything is lost.

Case: CEX collapsed, accounts frozen; large account mnemonic phrases stolen, tens of millions of dollars wiped out overnight.

Do you think hackers won't target you? As long as you have assets, you have value to be attacked.

✅ Correct posture:

• Transfer large amounts of coins to hardware wallets (Ledger, Trezor);

• Write down mnemonic phrases and save them, never screenshot or upload to the cloud;

• Small amounts can be traded quickly on CEX, but your 'household' must be managed by yourself.

❌ Pitfall 4: Leveraged addiction, resulting in nothing left but zero.

Reality: In March 2024, a major correction, with a liquidation rate of 90% in leveraged areas.

You think it's a wealth accelerator, but in reality, it's a loss magnifier.

✅ Correct posture:

• Newcomers should not touch leverage; honing skills and mindset in spot trading is the way to go;

• Even experienced traders should use at most 2x leverage, positions should not exceed 20%, and stop losses must be strictly adhered to;

• The more you think 'I can take it all in one go,' the easier it is to return to square one overnight.

❌ Pitfall 5: Watching the market daily, and getting itchy hands while watching.

Psychological truth: Wanting to chase when prices go up, wanting to cut losses when prices go down, humans are inherently unsuitable to be rational traders.

The market's best skill is to 'borrow your emotions and take your principal.'

✅ Correct posture:

• Write a trading plan in advance, follow it, and don't chase the market;

• Pay less attention to short-term fluctuations and focus more on trends above the daily line;

• Trade with 'idle money' so your mindset won't be led by emotions.

✅ Ultimate advice (for newcomers who haven't entered the market yet)

1️⃣ Use idle money that you can afford to lose for trading, don't touch living expenses or mortgage money;

2️⃣ BTC and ETH are the foundation, long-term holding is the underlying defense;

3️⃣ Always be on the path of improvement, the deeper the understanding, the lower the risk.

If you are a newcomer, please save this article three times, read it three times, and share it three times.

The first step to minimizing your losses is not to find the coin that makes you rich, but to avoid these pitfalls first.

If you think there are more 'pits that newcomers must step in,' feel free to leave a comment.

This is not just an article, this is your first line of defense to go further.

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