Crypto trading can be a lucrative activity – but only if you do it right. If you’re new to the world of crypto trading, then you need to be aware of the potential pitfalls that could bankrupt you. In this article, we’re going to explore 15 crypto trading mistakes that newbies should avoid at all costs.
So, whether you’re just getting started in the world of cryptocurrency trading or you’re considering making the leap, be sure to read this article first!
It’s easy to fall in love with all the cryptocurrency trading when one is making some money out of it. However, at times, not knowing what we are trading our money on and why can make a bad move for us.
For example, if you are just starting things, there might be no need for you to learn about crypto trading. But it will soon become an essential part if you want to understand this financial market. There are many reasons, which make you start investing your time into cryptocurrencies.
There are no secret ideas or hard-to-understand ones, but I am going to share with you 15 common crypto trading mistakes that you shouldn’t do. I am going to talk only about big mistakes, like selling coins with fake offers, using funds from exchanges, and never trading with friends. But don’t worry, I am going to explain to you how to avoid them!
Here Are the Top 10 Most Common Mistakes in Cryptocurrency Trading
The major mistake that people usually stumble upon while doing cryptos trading is selling coins. To put it like this: “I have some tokens on my exchange platform, now, I’m selling them to earn some profit. This way I can earn some extra income. So, what happens? That means in order to make money, I bought these tokens…” As the name says, selling your coins to get other profits is called Selling Exchanges. It sounds funny and sad, and these scams are very widespread nowadays.
Below are the top 10 most important mistakes in Crypto Trading
1. Not Understanding Trading Limits In The Market
In any financial market, it is very necessary to follow trading limits and trade without losing too much time.
However, there are some steps, which must follow before starting any trading process:
You must know the trading limit. You can find it in several different ways, such as through mutual funds or on official websites. Here is a shortlist of three main methods to look up.
The first method is – Calculate Your Risk Limit & Profit Limit By Using A Trading Tool.
2. Never Investing with Friends
It is always better to avoid getting addicted to any kind of trading and instead, choose strategies and investments by yourself.
On the contrary, when we are spending hours or days trading, sometimes we might fall into traps. As you can imagine, this can lead to losses. Therefore, always keep your best friend away from it.
3. Poor Knowledge of Trading Languages
You might think that you won’t learn anything new while working on trade platforms. However, it may not be true. Actually, not knowing something about trading languages may harm your results!
To explain it even more simply, let me give you a short story: If you want to invest in Bitcoin, it’s impossible to learn English. On the opposite, they say that it’s easier to become a millionaire than to learn English.
4. Never Do Long Selling
It’s great to see when crypto traders start to lose their patience but it makes me sad to see long selling habits started soon after.
You know when something appears unexpectedly and with no warning and you know you should take care of your shares immediately and go back! You probably don’t care about it, as you are already holding so much money, which means that you will lose everything for nothing.
5. Always Thinking About Price Changes When Working
On average, the price of crypto and other markets usually follows the prices of all other assets and industries. Sometimes you may think that you just don’t want to wait before seeing some change, but it’s really not always true.
For example, you can see here that bitcoin prices have dropped during the last few months and it doesn’t seem like the price was going down this year but still we should believe that the value of BTC will increase.
6. Doing Too Much Trade Daily
While doing crypto trading daily, sometimes you might feel that you don’t have enough time to work on your strategies! You can understand what I mean if you have experienced it!
In fact, your time management skills might not be as good as in any other type of job. You must always keep in mind that people get tired if they are stuck at work for 8-10 hours, so it’s best to make use of your time wisely.
7. Getting Lied into Making an Offer For Extra Profit
While almost everyone thinks that trading daily is the main thing, they don’t know that sometimes people also try to make sales to earn extra profits. Especially, when the trading volume is low, people tend to make unnecessary sales to make sure that they will never lose the investor’s money.
It may happen that you are not aware of your potential competitors, but it happens more often than not! For example, if you are not sure about how to create awareness about these companies on social media, always check them because you never know when someone could come along and offer you a free trial opportunity!
8. Talking About Binance
It was actually a bit difficult to describe that Binance is the most popular cryptocurrency trading platform! It’s due to the popularity of this platform that it has created connections between major companies. So, it is possible that other investors try to imitate it a little, but it doesn’t matter that you follow their rules of trading, you never stop following them. They always help you stay successful!
9. Trying to Sell Funds from Exchange Scams
The biggest scam that can appear in crypto trading is buying and selling with funds from exchange platforms. What does it mean exactly? Well, in crypto trading the sale of funds means selling one number of tokens, or you can exchange it for another amount.
This type of transaction is referred to as “The Fintwit”.
It is a huge scam because they always tell you that these exchanges are safe and reliable. However, this isn’t always true, and this is one of the reasons why hundreds of millions of dollars are lost each month.
10. Breaking Your Own Rules
The same principle is applied in trading, except that while having financial restrictions, it is necessary to make decisions according to your own interests, rather than follow the guidelines.
I understand that some people simply don’t want to accept that there is a possibility to sell tokens. Maybe for that reason, you don’t know exactly how to make a profit from trading!
11. Being Surrounded by Other People Who Are Only Trading
When we are working on trading, it is almost inevitable that we meet other investors and investors who are making similar trades and ask us questions and help us from trading. So, always be careful, and never go around trading with others. Remember that it is your responsibility as an investor to protect your investment!
12. Sharing Accounts
When you share accounts with other people, you will lose your status on the platform. Nowadays, sharing accounts is becoming a serious problem. Because we are constantly looking for new participants, and then, when we find those, it is hard to stop the fraud from spreading.
Therefore, always keep all your holdings private and to yourself. Also, remember that all the information you get about your account is completely private. Never share with anyone else.
13. Forgetting to Take Care Of Yourself
As we have mentioned above, we all are not able to stick to our jobs, but we cannot stay home either! We always have some business meetings, and we cannot stay at home forever.
Many of us do not know how to balance our lives, while others do not want to miss it either, and I think that it can be just as unhealthy and confusing as trading.
So, always pay attention to yourself! Don’t forget to eat healthy! Exercise and take a break, but don’t neglect your hygiene! Stay active! Keep yourself well-prepared! Always think about why not to drink alcohol! Have fun, but remember that sometimes we are forced to do otherwise!
14. Buying Bullseye Prices Without Knowing It
Do you know that bullseyes are used to trade? Let me tell you why! These types of markets follow market patterns and the buyers can predict price changes! Of course, you probably do not believe that traders always follow these types of prices to a level where they will earn extra profit. But I would like to tell you that it can be done.
You might be wondering why did I mention this type of trading before I tried to explain why you should not do it! After all, I am not trying to scare you from trading! Well, actually it is possible to do so. At present, I will leave it for you to decide, but it’s not impossible to do.
15. Not Wanting to Read Trading Books
You might not be aware of this fact. But in this article, I will tell you that it’s hard to make people follow trading books. They mostly stick with basic knowledge and tend to forget about everything else.
So, to keep things fair, reading books is recommended to you! You will get to learn about trading while you sleep!