The fundamental reason why ordinary investors lose money when trading cryptocurrencies is not that simple.
The main reason for most losses is: having a small position when the price rises, and a large position when it falls sharply.
The emergence of this situation ultimately stems from trading habits.
When buying a rising cryptocurrency, the initial position is often not large, but as the price continues to rise, it is often difficult to resist the temptation to increase the position, ultimately reaching the maximum position during a pullback, resulting in making money with a small position but suffering significant losses with a large position. Although sometimes one can correctly add to a position, trading cryptocurrencies is a long-term process, and such trading habits will eventually lead to significant losses. Therefore, to avoid this habit, it is necessary to cultivate the habit of buying low and selling high, rather than the reverse.
Opportunities after market adjustments?
Here are a few suggestions:
1️⃣ Fixed position building: Do not arbitrarily change positions.
2️⃣ Only reduce positions, not increase: Once a position is established, only consider reducing it, and do not increase the position.
3️⃣ Do not build positions arbitrarily: Especially in unclear market conditions, avoid blindly building positions.