According to ChainCatcher news, top trader Eugene Ng Ah Sio recently summarized his trades, and after perfectly going long on BTC from $102,000 to $107,000, I decided to transfer these profits to SOL and long positions in the SOL ecosystem. The entry point at that time provided a moderate risk-reward ratio (r/r), specifically: going long on SOL at $220, WIF at $2.75, and BONK at $0.037. This was based on SOL's strong performance on the low time frame (LTF), as well as the confidence gained from previous successful trades. When the BTC market began to turn at $108k, I was not pleased with the trading performance of some meme coins, so I decisively closed positions in the underperforming assets, accepting an acceptable loss (which was the right move). However, I did not close my SOL position; instead, I chose to increase the position from $20 million to $30 million. This led to the formation of the first mistake.
Mistake 1: Not cutting losses in time:
Usually, one of my strengths is being able to exit positions timely when they start to lose strength, to avoid larger losses. However, this time, I chose not to cut losses when SOL fell to $215, even though I believed the market would experience downward volatility around the FOMC meeting. My bias overwhelmed my logic, and the psychological excuse I used to comfort myself was that $200 was a key support level for SOL, and it was very close; I didn't want to be 'liquidated' by the market for trying to catch a 5% move. When SOL fell to the $200 support level, I further increased my position, raising it from $30 million to $45 million, reasoning that the risk-reward ratio at the high time frame (HTF) support was optimal. I do not think this was a mistake, but it did make an already complicated situation more precarious.
Mistake 2: Ignoring stop-loss points:
When SOL broke below $200, the clear action should have been to close the position as planned. However, I chose to hold on, as the position size had become so large that closing it at that moment could trigger a waterfall drop in the SOL price down to $190 and ruin the entire chart. At that time, I began to harbor 'hopium,' thinking 'maybe there will be a lower shadow breaking support, then bouncing back up.' This mindset is definitely a red warning signal, and I will pay special attention to it. Additionally, after the price fell below $200, I leveraged between $187 and $193, expanding my position size to nearly $60 million (total account leverage reached 1.2 times). This was clearly a wrong move, but as you can see, the mistakes began to pile up. Fortunately, a complete 'black swan' event did not occur, and I did not face greater consequences because of it.
What I did right:
When the unrealized loss reached $7-8 million, I decided that 'enough is enough' and decisively cut my losses. I closed 70% of my position at $193, which freed up cash for re-establishing positions at the final bottom, including ETH, ENA, PEPE, and WIF, almost nailing the bottom. Ultimately, the actual profit and loss (rPNL) from this trade was a loss of $6.2 million, approximately -10.2%. Since then, I have executed 13 trades, all of which were profitable, essentially recovering this loss. I think this is a great example that shows how a trade can go wrong from the very beginning, and then mistakes continue to accumulate, potentially becoming very severe, especially when the 'sunk cost fallacy' takes over. Fortunately, I was able to break free from this mindset, which allowed me to trade calmly and accurately at the market bottom. This was my largest single position loss in this account, and I will remember this lesson for a long time.
Merry Christmas, friends.
