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Ten Bad Habits of Crypto Traders: How Many Do You Have?

It's the weekend, and the bears are finally taking a break. Bitcoin has bounced back a little, but the market is relatively calm. Today, let's skip the market analysis. Instead, let me walk you through ten bad trading habits (especially in contract trading) that I've personally fallen into. Family, see how many of these apply to you!

1. Chasing Highs and Panic Selling at Lows

Investors often experience FOMO (fear of missing out) during price surges, blindly buying at the top. When the market drops, panic takes over, and they easily believe bearish voices around them, leading to irrational selling or shorting at the bottom.

2. Trying to Short in Bull Markets, Bottom-Fishing in Bear Markets

Constantly attempting to short during clear uptrends or catching bottoms during downtrends, trying to capture every reversal. Psychologically, this comes from overconfidence bias.

3. Relying on Others’ Opinions to Place Trades

Overly dependent on social media influencers, so-called "insider information," or group recommendations, lacking independent analysis. If they don't have a trading plan or get stuck in a position, they seek advice everywhere and follow others’ opinions.

4. Can't Handle Losses in Spot, Selling at the Bottom

Spot trading should be the easiest form of investment since there’s no risk of liquidation and no need to monitor constantly. But many investors have weak psychological endurance, always thinking prices will fall further, so they sell at a loss and try to buy back at a lower price—often, the price they sell at is the actual bottom.

5. Unable to Hold Contract Positions, Closing at Every Fluctuation, Chasing Upswings, Frequent Trading Leads to Loss

Initially calm when opening a position, but can't withstand wash trading tactics. They love watching the screen and trading frequently. According to a certain exchange’s Q1 2024 data, users who trade more than five times daily pay an average monthly fee of 3.2% of their principal, while those who trade less than twice a month pay only 0.4%.

6. Reversing Positions in Contracts, Leading to Chasing Highs and Selling Lows

Closing a long position and immediately opening a short (or vice versa), essentially trying to fix a previous mistake with a new one.

7. Trading Without Stop Losses, Preferring to Hold Losing Positions

Rooted in wishful thinking and unwillingness to accept losses. Maybe you can get away with this 10 times, but with just one failure, your account can go to zero. The 220,000 traders who were liquidated last Friday can certainly relate.

8. Feeling Anxious and Restless Without an Open Position, Always Wanting to Trade

Fearing to miss out on the market, they trade frequently—even opening positions when there’s no clear opportunity. Always thinking opportunities are fleeting and unable to tolerate quiet market periods. All gains from trending markets are lost in choppy ones. This is something I still haven’t solved.

9. Staying Up Late Watching the Market, Lack of Energy, Emotional Instability

Watching the market is addictive, but know that staying up late constantly will decrease your decision-making ability. Studies show that lack of sleep significantly increases risk-taking behavior.

10. Not Withdrawing Profits, Doubling Down on Losses

This is the most fatal habit, which is why I saved it for last. If you’re a spot investor, you can ignore this, since your goal is simply to accumulate more coins. But if you’re a contract trader, remember: the money you make through a combination of luck and skill over ten trades can be lost in just one or two mistakes. If you don’t withdraw, your profit is just a number.