1. Lack of a Trading Plan
Mistake: Entering trades without clear entry and exit strategies or risk management.
Impact: This often leads to emotional trading, overtrading, and chasing losses.
2. Ignoring Risk Management
Mistake: Allocating too much capital to a single trade or not using stop-loss orders.
Impact: A single bad trade can wipe out a significant portion of the portfolio.
3. Overleveraging
Mistake: Using excessive leverage to amplify profits without considering the risks.
Impact: Market volatility can lead to liquidation of positions and significant losses.
4. Chasing the Hype
Mistake: Investing in coins based solely on social media hype or FOMO (Fear of Missing Out).
Impact: These coins often lack solid fundamentals and may experience pump-and-dump schemes.
5. Lack of Diversification
Mistake: Putting all funds into one or a few cryptocurrencies.
Impact: If those assets perform poorly, it can result in heavy losses.
6. Neglecting Fundamental and Technical Analysis
Mistake: Making decisions without researching the project or analyzing price trends.