I’ve read a lot of articles, watched tons of videos, took multiple online courses about trading. I am pretty confident that I wouldn’t make some of the ‘dumb mistakes’, but I’m wrong, for being overconfidence and think that I’m rational, I’m having full control of my emotions. Turns out I’m wrong, I still make some of the mistakes that I thought it was dumb. Anyway, these are the top mistakes I made, and I hope you wouldn’t.
Not using stop-loss
Probably one of the most common mistakes, and I believed every successful trader must’ve made this mistake at least once or few times throughout their career in trading. The reason I made this mistake is that I’m so confident that I’m going to make a profit for the trade I’ve just entered and did not even thought about losing that trade. This is probably the mistake gave me my biggest loss, which is position went into a margin call.
bet too much in a trade
There are a few times that I thought I couldn’t lose a trade, clear breakout from a hard resistance, strong bullish volume backing up, multiple indicators agreed with me, what’s the reason not to bet all your stake in this ‘sure-win’ bet? It’s a rare opportunity! Then combined with the first mistake, not placing stop-loss, it wiped up half of my account in a trade. That’s it, always be consistent and systematic in determining your trade size, learn proper fund management!
Strong movement on the chart, everyone is talking about getting into a trade, people flashing their ‘float-profit’ (P/L that’s not realized until a trade closed.) This is the time FOMO kick in, I don’t want to miss this rare opportunity, so I chose to chase the bet. This is very bad when you start to make trades without a plan and listen to the other peoples in the chat room, you are no longer a trader, but a gambler. Don’t let your greed and emotion take control of you!
Trading too much market
When I started trading, I wanted to trade as much market as possibles, from cryptocurrencies, stocks, and commodities, as I thought by doing so I can capture every single profitable move across all the market, then it turns out I loss more opportunities. There is not wrong for one to focus on a single market, a single product, especially as a beginner. Now I’m only trading few cryptocurrencies pair, and never enter a trade in another pair when I have an active position, by doing this, I was more comfortable and confident in placing trades.
Last but not least
Of course, I made more than just the above-stated mistakes, so I’ve adopted a habit that hopefully can help me prevent repeating same mistakes in futures. How? I’ve decided to make a trading log that I will manually write down every single trade I made, if it’s a losing trade, I would find out and record what’s the cause, same goes to the winning trades.