When first engaging with Binance, many beginners have the expectation of 'quickly getting started and making easy money', but in practice, they often fall into pitfalls—either getting stuck after chasing highs or losing their principal due to small oversights. In fact, most of these losses are not due to 'bad luck', but rather low-level mistakes that could have been avoided in advance. Below, we break down the 5 most common problems beginners encounter, along with timely pitfall avoidance plans to help you pay less 'tuition' when trading on Binance.
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1. Buying coins based on 'hearsay': You rush in when others say it will rise, only to become a 'bag holder'.
Many beginners open Binance and see screenshots of coins skyrocketing in the community, or posts claiming 'XX coin is about to double', making them unable to resist buying along. Such actions driven by 'fear of missing out (FOMO)' are likely to result in them buying at a high—like if a certain altcoin suddenly rises by 50%, when they follow suit, it’s likely that early holders are cashing out, and they end up watching the price drop back down.
Pitfall avoidance plan: Do your 'homework' before placing an order. Open the 'coin details page' on Binance and first check the project introduction: What does it do? Are there any practical application scenarios? Next, check recent announcements for negative news like team exits or technical vulnerabilities; finally, look at the candlestick charts to see if the trading volume has been stable over the past three months and if there are any 'abnormal trends' with sudden spikes. Do not act impulsively before understanding these aspects.
2. No stop loss: If it drops, you hesitate to cut losses, and in the end, you lose everything and just 'lie flat'.
The most common mistake beginners make is thinking 'setting a stop loss will cause me to miss the rebound'. For example, after buying a coin, if the price drops from 100 USDT to 90 USDT, they think 'I'll wait a bit longer for it to come back', only to see it drop all the way down to 50 USDT, cutting their principal in half. Understand that a stop loss is not 'admitting failure', but rather putting a 'safety net' on your account—so even if your judgment is wrong, you can preserve most of the principal and leave room for future opportunities.
Pitfall avoidance plan: Set your stop loss when placing an order. For short-term trading, set the stop loss at 5%-8% below the purchase price; for long-term holding, refer to recent support levels (like the lowest price over the past month). For example: If you buy a coin at 100 USDT and are trading short-term, set a stop loss at 92 USDT; if holding long-term and the recent low is 85 USDT, set a stop loss at 84 USDT. Remember: Small losses are acceptable, but liquidation is lethal.
3. Chasing 'volatile coins': Focusing on 'rocket coins' but stepping into 'scam traps'.
Occasionally, you will see coins on Binance that have 'increased by 200% in a single day'. Beginners, seeing such 'rocket行情', get eager thinking 'I can make quick money'. However, most of these coins lack fundamental support; they are either manipulated by whales or are subject to short-term speculation. By the time you rush in, the whales may have already started selling, and the price will plummet like an avalanche. For example, if a coin rises from 20 USDT to 60 USDT, and a beginner chases it, it could drop back to 15 USDT in just half a day, leaving them trapped.
Pitfall avoidance plan: Stay away from coins that 'suddenly rise for no reason'. When filtering for coins, prioritize 'projects in the top 100 by market cap' and 'average daily trading volume over 100 million USDT'; these coins tend to have stable fluctuations and are less likely to be manipulated by whales. If you really want to pay attention to small-cap coins, observe them for a week to see if their price movements have any pattern and if there is sustained capital inflow, rather than a 'sudden explosion'.
4. Being swayed by emotions: panic selling when it drops, greedily holding when it rises.
Many beginners trade based on 'mood': they panic and sell when the price drops by 2%, fearing it will continue to fall, and by the time they sell, the price rebounds; when the price rises by 5%, they become greedy, thinking it will go higher and refuse to take profit, ultimately giving up profits or even incurring losses. In trading, 'greed' and 'fear' are like two traps; the more you let them control you, the more likely you are to make wrong decisions.
Pitfall avoidance plan: Write a 'trading plan' in advance and strictly adhere to it. For example, if planning to buy a certain coin: 'Buy at 100 USDT, take profit at 110 USDT, stop loss at 92 USDT'. Regardless of how the price fluctuates during the process, do not act until the target price is reached; if holding long-term, set 'no selling as long as the fundamentals stay the same', such as if the project has not released negative news or encountered technical issues, do not panic even if the price drops in the short term. Remember: Trading by rules is more reliable than trading based on feelings.
5. Ignoring account security: Simple passwords, not enabling 2FA, funds are at risk at any time.
Some beginners think 'I don't have much money in my account, no one will steal it', so they use '123456' as their password or do not enable two-factor authentication (2FA). However, in the crypto world, hackers specifically target such 'weak security' accounts. Once an account is hacked, the coins inside can be transferred away instantly and are difficult to recover—there have been users who lost 50,000 USDT because they did not enable 2FA.
Pitfall avoidance plan: Maximize account security. Use a password combination of 'uppercase letters + lowercase letters + numbers + symbols', such as 'Binance@2024!Tx'; do not use your birthday or phone number as a password; make sure to enable 'Google Authenticator' (do not use SMS verification as it can be intercepted), and store the backup key in a safe place (like writing it down on paper, not on your phone); also, do not click on unfamiliar links; Binance will not ask for your login information or verification codes through private messages.
Lastly, it’s worth mentioning: in crypto trading, 'stability' is more important than 'speed'.
Many beginners want to 'make quick money' as soon as they enter the market, only to end up losing their principal. In fact, trading on Binance is like learning to drive—first master the basic rules (like how to read candlestick charts and how to set stop losses), then gradually accumulate experience, rather than racing in from the start. Remember: The crypto market is not a place for 'getting rich overnight', but a place to 'make money through knowledge and discipline'. Lay a solid foundation and avoid these pitfalls to go further in long-term trading.
