A Genuine Share After 6 Years as a Trader: 5 Valuable Lessons to Help You Avoid "Burning" Money Unnecessarily

When I first stepped into the world of cryptocurrency, I was also confident: "Trading is simple, just guess the green and red correctly to profit." In reality, it is not that simple. After more than six years of battling and dozens of account burnouts, I finally understand that trading is not just about chasing price trends, but is a journey of cultivating discipline, managing risk, and educating the mindset. Below are 5 hard-earned lessons to help you avoid the mistakes I made.

1. Don't FOMO with the Crowd Understanding what FOMO is: Fear Of Missing Out – the fear of missing an opportunity. When someone "calls out" that this coin is about to "explode" in price, many new traders often rush in to buy without researching. Consequences: The price pumps and then dumps heavily, and the account "evaporates" in an instant. Advice: Build your own analysis process — both fundamental and technical. Trust in your own strategy, and don’t let outside noise determine the fate of your coin.

2. Capital Management Is the Key to Survival No all-in: The moment you put all your money into a trade is when you are betting too much on an uncertain variable. Limit margin/leverage use: Leverage can rapidly increase profits, but it can also "wipe out" your margin account as soon as the price deviates by 1-2%. The 1-2% rule: A common principle is to risk a maximum of 1-2% of the total capital on each trade. For example, with $10,000, the stop-loss order should not exceed $100-200. Thus, if the market reverses, you are still safe to continue "fighting".

3. Always Have a Clear Plan Determine entry points (entry): Based on support/resistance zones or breakout signals. Take profit (take-profit): Set a profit target, such as 5–10% per order depending on the strategy. Stop loss (stop-loss): Absolutely comply, do not "hold your breath" waiting for the price to return. The formula for calculating the stop-loss size is based on ATR (Average True Range) fluctuation or Risk/Reward ratio (1:2 or 1:3).Illustration example: Open an order to buy ETH at $2,500, set a stop-loss at $2,400 (rủi risk 4%), take-profit at $2,700 (lợi profit 8%). Risk/Reward = 1:2.When the price reaches $2,650, you can partially close the order to preserve capital, pulling the stop-loss up the cost price for the rest.

4. Psychology – The Real "Boss" Decides the Outcome Greed and fear: When prices go up, greed prevents you from taking profits; when prices drop, fear makes you panic sell. Both kill traders faster than any market crash. Maintain a calm mindset: Use the trading journal (Trading Journal) to record the reasons for entering trades, your emotions at that moment, and the outcomes. Through each trade, you will identify your "psychological weaknesses." Practice meditation or breathing exercises: Helps reduce stress and make clearer decisions.

5. Learning is Never Enough The market is always evolving: From Altcoin to DeFi, from NFT to AI-driven tokens… Each wave has its own rules. Diversify your learning channels: In-depth courses on technical analysis, on-chain metrics. Join reputable communities, discuss with experienced traders. Read books on risk management and trading psychology. The tuition is the account's volatility: Every time the market goes against expectations is a lesson, but don't let the "tuition" be too expensive—start with a small capital or a demo account. Conclusion Trading is not a race to win immediate rewards, but a long-term journey that requires iron discipline, a clear strategy, and continuous learning. There are profits and losses, but the most important thing is that you are still in the game. If you are just starting, take the time to build a solid knowledge base before putting large sums of money into the "playground." Wishing you success and enduring patience on your path to becoming a professional trader.