In crypto trading, one of the most common and dangerous mistakes is not being willing to cut losses. Many newcomers to the market have fallen into the familiar scenario:

You bought BTC at 70,000 USD, expecting the price to hit 75,000 USD a few days later. But instead of rising, the market turned and the price dropped straight to 63,000 USD (the account is nearly down 10%).

At this moment, instead of adhering to the original plan and cutting losses at the predetermined level, a self-reassuring thought echoes in your mind:

👉 “It's okay, it will come back.”

But the harsh reality is: BTC continues to drop deep to 50,000 USD, then stays sideways for 2 months.

Result:

  • Your capital is stuck in a losing trade.

  • Missing the opportunity to join other good trades.

  • Every day opening the app, seeing the account “in the red” increases stress.

Why are we unwilling to cut losses?

  1. Hope psychology – You believe that as long as you are patient, the price will return to the buying point.

  2. Self-justification – “The shark is accumulating”, “This chart is about to breakout”, “Good news is coming soon”…

  3. Afraid to admit failure – Cutting losses means accepting that you were wrong, which makes many traders “stubborn” to hold positions.

But the market doesn’t care about your reasons. Prices only follow supply and demand and trends, showing no “mercy” to any account.

Consequences of not cutting losses

  • Small losses turn into big losses: A loss of 5-10% can be managed, but if it turns into 30-40%, recovering will be extremely difficult.

  • Capital is stuck: While you are “holding a coin” waiting for the price to recover, a series of other opportunities in the market are missed.

  • Psychological pressure: The longer you wait, the more stress increases, leading to irrational decisions.

Solutions for traders (especially beginners)

  1. Always set a Stop Loss (SL) before entering a trade. This is the “survival barrier” for the account.

  2. If you often break SL due to psychology → reduce the trade size. When the risk is smaller, you will find it easier to adhere to discipline.

  3. Don’t turn a losing trade into “a reluctant long-term investment.” If you didn’t have a long-term holding plan from the start, don’t deceive yourself into holding the coin.

  4. Remember that hope is only valuable when based on a plan and discipline. If it is solely based on emotions, hope will become the number one traitor.

✅ In trading, cutting losses is not a failure, but a survival strategy. Lose a small trade today to have capital for big opportunities tomorrow.

💡 A question for you: Have you ever “held a coin” for a month because you were afraid to cut losses? And what lesson did that experience teach you?