Here are the top five mistakes traders make while getting started with crypto trading. From not trusting names like Bit Eprex Pro to underestimating the curve!
So you finally took the plunge and opened your shiny new cryptocurrency trading account. The interfaces blink with exotic coin names and flashy charts. “Easy street, here I come!” you think.
But soon enough reality hits. Your first few trades get stopped out for losses. Then you buy some hype-coin shilled on Twitter only to watch things head south immediately after.
Panic sets in seeing your capital shrink. FOMO tempts you to average down but only makes that stomach-churning red number bigger.
“What am I doing wrong?” you wonder, hands shaking over the keyboard. “Maybe I’m not cut out for crypto trading.”
Put those worries aside for a moment and take a breath, my friend! What you’re experiencing is totally normal. Every single pro trader you see crushing it today has endured their own ugly early days.
But here’s the good news – with the right guidance and basic frameworks in place FIRST, your crypto venture doesn’t have to keep feeling like a trip through financial purgatory! You can shortcut years of pain and accelerate your progress massively just by avoiding some key beginner pitfalls I’ll share now.
So park the dreams just a minute longer and let your future championship mentor spill the beans on what REALLY works to thrive as a crypto trader long-term.
Mistake #1 – Jumping into Trades Emotionally
Hands down the biggest reason startups flush money down the drain fast is they start trading emotionally rather than leaning on cold hard analysis.
It just feels different when your own hard-earned money’s on the line versus paper trading, right? Fear and excitement take over the logical part of your brain. Your finger hits that buy button based on FOMO and hope rather than any strategic thinking.
To break this cycle, the FIRST thing to get handled is getting your head straight. Accept that impulsiveness is a natural human weakness here. Then make rules for yourself like:
“I will NOT chase pump chats or ‘hot tips from insiders’ ever again.”
“BEFORE entering any trade in real money, I must identify the chart levels and indicators supporting this setup.”
“I will calculate position size appropriately to limit overall risk before moving forward.”
In other words, do your homework first! Don’t even think about handing over your capital until you’ve got facts confirming your next trade meets strategic criteria rather than just feeling right emotionally.
Mistake #2 – Underestimating the Learning Curve
Now maybe you’ve heard stories of lucky newbies 10x-ing right out the gate. But that’s like your beer pong buddy from college getting signed to the NBA. Can lightning strike? Sure. But the much deeper reality is mastering crypto trading takes most people years upon years honing their skills through different market environments.
So if you’re expecting to knock this game out quick just because you watched some YouTube videos and join a few Telegram groups, sorry but you’re in for a rude awakening!
But here’s the key – embrace crypto trading as a journey of continuous learning rather than a get-rich-quick scheme. When you know upfront mastery takes time, those early flops sting less and become data points guiding your improvement.
So set reasonable expectations, stay patient knowing profits WILL come in time, and make consistent knowledge building your secret weapon!
Speaking of dangerous assumptions, the next big factor killing accounts fast is around risk.
Mistake #3 – Going Wild Without Risk Management
You must be thinking why doesn’t anyone warn new traders just HOW volatile crypto markets are compared to other assets?
Without proper risk management in place from day one, the above scenario becomes inevitable rather than hypothetical. And when things REALLY get nasty, blown accounts often follow hot on the heels of bruised egos.
So what should responsible capital protection look like exactly for crypto startups?
First off, CONTAIN POSITION SIZE appropriate to your whole portfolio – 1 to 5% per trade max.
Use STOP LOSSES religiously to automatically exit trades if levels break against you. Keep stops tight at obvious nearby support/resistance areas and deal with a few more losses exiting early in exchange for protecting the downside ferociously.
Another pro move is setting partial take profit orders to secure SOME winning trades even if you don’t nail tops and bottoms perfectly. Something is always better than giving back 100% of gains!
Losing isn’t the best feeling, no matter how small and cuts against our hunting instincts. But don’t avoid taking protective measures just to sidestep facing small losses early on. Build the habits now shielding yourself on every trade with stops, limits and restraint around pile-driving in too big.
Then when the next flash crash wave hits (and it WILL), other traders get wiped out while you live on to swing another day!
Now onto the fun stuff: how to actually MAKE money in crypto trading.
Mistake #4 – Shooting From the Hip With No Plan
So day one with your shiny new Binance account open, what’s your game plan? Sit around watching price bars until something “looks good” to jump into?
Listen here – putting real skin in the game without a STRATEGY pre-made is like taking the wheel of a sports car blindfolded. It’s never safe!
To actually generate consistent profits, crypto traders MUST develop a framework detailing key rules like:
- What market conditions signal viable trades?
- Where to enter/exit?
- How much to risk per setup?
- What scenarios tell me to stay flat and watch instead?
And as a beginning trader, keep things simple at first! Start out using basic chart indicators like EMA crosses, RSI levels or volume breakouts to confirm your trades rather than getting overwhelmed trying to master Elliot Waves Day 1.
Then equally crucial. WRITE DOWN YOUR PLAN! Don’t just assume you’ll remember because once emotions start flowing, that strategy you THOUGHT would guide you flies right out the window.
Instead, stay centered making trades by actually referencing detailed notes spelling exactly what must happen to take the next step. Remove all discretionary decision fatigue by developing reference able rules upfront.
And the final habit that will make or break your startup’s trading career.
Mistake #5 – Stubbornly Staying Static in Your Skills
Suppose a doctor from the 1960’s time traveled to perform surgery today. Do you want him handling your operation with 50+ year old medical knowledge and techniques?!
Well in crypto trading, clinging to outdated methods or beliefs will slash your profit potential just as severely long term.
That’s because the world of blockchain technology keeps evolving rapidly, at a very fast pace. New exchanges launch monthly. Memecoins and scam projects constantly flood the scene, with regulatory policies shifting as countries warm up to digital assets around the globe.
With so many moving parts, the ONLY way startup traders secure relevance (much less stay consistently profitable) is committing to ongoing learning and adaptation to advancements.
The best in the game make expanding expertise a central focus by:
- Reading new crypto research papers & articles daily.
- Get help from Crypto Trading bots like Bit ePrex Pro.
- Trying the latest trading tools for back testing experiments.
- Attending Web3 conferences to network with other mathematicians and developers.
- Experimenting with new datasets like on-chain metrics not just price action.
Make developing a “lifelong student” mindset priority #1 from day one. Squeeze knowledge growth in daily even on busy days to keep strategies current. Then by gaining first-hand market exposure over Years (not weeks), your developing intuition becomes incredibly valuable managing risks and spotting opportunities most newbies miss.
In Conclusion
Now that you know the REAL deal avoiding beginner blunders, nothing stops you from becoming part of that successful group yourself if you start taking the right steps.
The journey ahead likely still has bumps for sure. But by using your early days to build robust foundations around planning, risk protections and having an adaptive learning mindset, you equip yourself to surf market volatility rather than drown in it. Be open to advancements in the field like implementing AI bots such as Cryptohopper and Quantum AI to automate your operations in a smart way.