Countless originally happy families have been torn apart due to obsession with the cryptocurrency market and chasing unrealistic dreams of getting rich. If you are considering entering the cryptocurrency market, be sure to read the following content carefully; it may help you avoid fatal risks.
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1. First taboo: Full position—'ineffective busyness' year-round without rest
'Full position' refers to investors operating non-stop 365 days a year, 24 hours a day, ignoring market trends and acting blindly.
• Common mistake: Regardless of the overall market conditions, frequently trading for small profits, which results in wasted effort and exposes one to greater risks.
• Correct approach: The core of trading cryptocurrencies is 'assessing the overall trend'—actively buying when the trend is positive and resting with no or light positions when the trend weakens; learn to assess the situation and stop at the right time to avoid being overwhelmed by high-intensity operations.
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2. Second taboo: Eager to recover losses—'a fatal operation that leads to worsening losses'
In a crashing market, investors are often trapped with huge account losses. If they are eager to recover their losses, they will blindly increase their trading frequency and add funds to lower their costs.
• Common mistake: Adding positions against the trend and high-frequency trading not only fails to recover losses but also exacerbates them.
• Correct approach: Reduce or pause trading when the overall market is weak; patiently wait for the market to warm up and the trend to clarify before intervening.
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3. Third taboo: Full profit—'the trap of pursuing extreme profits'
'Full profit' refers to investors always thinking about buying at the lowest price and selling at the highest price, trying to capture all the profits from a particular cryptocurrency.
• Common mistake: Overly pursuing high profits, resulting in frequent 'taking the elevator' (profits being repeatedly given back), and missing out on stable returns.
• Correct approach: Let go of the obsession to 'capture all profits', 'let go of the fish head, spare the fish tail, and eat the fish meat', pursuing reasonable returns from steady growth.
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4. Fourth taboo: Eager to catch rebounds—'grabbing chestnuts from the fire' in a downtrend
In a market where the downtrend hasn't stopped, trying to catch a rebound is like reaching into a fire to grab chestnuts; a moment of carelessness can lead to significant losses.
• Common mistake: Ignoring the overall downtrend for the sake of short-term gains from rebounds, ultimately leading to severe losses.
• Correct approach: Recognize the reality of 'no missed opportunities in a downtrend', do not blindly participate in rebounds, and wait for a clear trend before taking action.
5. Fifth taboo: Full positions and leverage—'the last straw that breaks the family's back'
Most investors in the cryptocurrency market are forced to liquidate due to 'full position trading' or 'leveraging', ultimately exiting completely.
• Common mistake: Investing all of one's 'life savings' for family support into the market, getting trapped when fully invested, and due to immense psychological pressure, misjudging the market; using leverage further amplifies risks, and even slight fluctuations can lead to liquidation.
• Correct approach: Leave some margin in life; avoid full positions in trading, and absolutely do not use necessary living funds to trade cryptocurrencies, let alone touch leverage.
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6. Sixth taboo: Excessive panic—'self-abandonment' in a bear market
Panic during a crash is a common emotion for investors, but fluctuations are a natural law of the market; no cryptocurrency will forever decline.
• Common mistake: Selling at a loss due to panic in a bear market or giving up on learning and research, thus missing the preparation opportunity before a bull market.
• Correct approach: During a bear market, focus on learning and researching quality cryptocurrencies, prepare in advance to avoid repeating the old mistake of 'chasing highs and cutting losses' when a bull market arrives.
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7. Seventh taboo: Complacency—'the trigger for old investors' downfall'
Some investors can make a profit initially, but after becoming 'old investors', they become blindly confident after earning a little money and learning some indicators, frequently chasing highs and cutting losses.
• Common mistake: Pride and complacency hinder the improvement of operational skills, leading to misjudgment of the market and ultimately losing more than winning.
• Correct approach: The cryptocurrency and stock markets are ever-changing; always maintain a sense of awe, continuously learn and update your knowledge to avoid stagnation and being eliminated by the market due to complacency.
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Final reminder:
The risks in the cryptocurrency market are much higher than in traditional investments. 'Getting rich quickly' is just a coincidence for a few, while 'losing money' is the norm for most. Don't let fleeting greed destroy your future and that of your family.#BNB创新高
