Many traders fall into a common trap: holding onto losing positions, hoping the price will recover, while prematurely closing winning trades out of fear. This mindset can hold you back from real success in trading. To thrive, it's crucial to shift your approach: be optimistic when you're in profit and cautious when facing a loss. Instead of holding onto a losing trade, set a stop loss to protect yourself. But when you're in profit, let your trades run to maximize your gains.
Hereâs an example:
You bought Ethereum (ETH) at $3000 in the spot market, and the price starts to drop. Instead of setting a stop loss, you hold on, thinking, "It's okay, Iâll wait for the price to come back to my entry." Months pass, and ETH continues to fall. Eventually, after four to six months, the price may return to your entry point or slightly above, and you rush to sellâeither breaking even or making a tiny profitâbecause you fear another drop.
You might think that waiting for the price to return saved you from a loss. But hereâs the catch: you wasted valuable time holding onto a trade that couldâve been used for other profitable opportunities. This mistake, repeated over time, keeps you stuck in a cycle that prevents true trading success.
Many traders have bought altcoins at the wrong time, holding them for months (or even years) in hopes of breaking even. Break the cycle by managing losses effectively and letting your profits grow. Your time and capital are too valuable to waste!