Many common trading strategy mistakes stem from a lack of discipline and preparation. A significant pitfall is trading without a well-defined plan, leading to impulsive decisions rather than calculated moves. Similarly, ignoring risk management by not using stop-loss orders or risking too much capital per trade can quickly deplete an account.
Emotional trading, driven by fear of missing out (FOMO) or a desire for revenge after a loss, often leads to poor choices. Overtrading, or making too many trades, can also be detrimental as it often sacrifices quality for quantity. Lastly, insufficient research and chasing past performance without understanding underlying market dynamics are common errors that hinder long-term success.