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5 Common Mistakes to Avoid When Trading Crypto

It takes a strong knowledge base to confidently navigate cryptocurrency markets. Part of the learning process is knowing what to avoid. Knowing these five common mistakes before beginning your crypto trading career will help you avoid getting rekt.

Mistakes to Avoid When Crypto Trading

  • Falling for FOMO & FUD
  • Excluding Profit Taking
  • Revenge Trading
  • Overtrading
  • Focusing on Short Term

#1 Falling for FOMO & FUD

New traders often enter digital asset markets because a certain coin is getting a lot of attention in the media. However, this is when Fear of Missing Out (FOMO) is at its highest as well so the coin’s price could be at an all-time-high, significantly limiting the potential gains of the buyer.

  • Setting up automated trades with bot platforms like Quadency helps to keep emotions in check so traders don’t fall victim to FOMO.

Fear, Uncertainty, and Doubt (FUD) can also steer novice traders in the wrong direction with false information marketed to cause confusion and fear. Traders that act on FUD are simply acting on subpar information.

  • Focus less on listening to what others say about a crypto project and DYOR to examine the project’s documentation, community channels, and website before considering a trade.
”How-to-Identify-Risk="95%"Ways to Identify Risk

Avoid FUD and FOMO with Quadency’s Accumulator Bot

#2 Not Planning Losses & Profit Taking

A trading strategy that doesn't limit your losses can result in digital asset devastation. On the other hand, taking profit from your crypto trades only randomly or now and then can lead to emotion-based trading decisions.

  • Setting up a stop-loss level can be accomplished for both short and long positions to firmly limit the amount of losses you incur.
  • Setting up a profit target helps you manage the profits you earn while trading. When a trade goes up a certain percentage, you can sell all or a percentage of the profits automatically.
  • Stop loss and take profit levels can be fixed or "trailing".
”trailing-stop-loss-take-profit="95%"Trailing vs. Fixed Stop Loss and Take Profit

Learn how to set up Stop-Loss and Profit Targets with Quadency’s Smart Order

#3 Revenge trading

Revenge trading is a natural response after a trader experiences a major loss in the market. With emotions running high, they may take loss prematurely or over-trade to try and recoup their losses.

To avoid Revenge Trading, try these tips:

  • Stick to your trading strategy and look to the long term.
  • Take some time to review your strategy, conduct some technical analysis, and look for patterns and trends.
  • Take a break from charts and trading platforms and do something fun or get some rest.
  • Manage your risk of revenge trading during volatile times with automations like Quadency’s Portfolio Rebalancer.

#4 Overtrading

Overtrading is when a trader places buys and sells so frequently that it goes against their strategy and limits their profit potential. It can often happen when a trader experiences a big loss or a big gain and wants to quickly make trades in response to these big price movements.

Trading too much can limit your profits and put you at risk, so try to:

  1. Stick to your trading strategy.
  2. Get help managing your crypto trades with automated bots.

Try Quadency’s Bollinger Bands bot to automate buys and sells even through market volatility.

#5 Focusing on short-term

A long-term outlook in crypto trading is a healthy outlook, especially when you consider that we’re only at the beginning of the cryptocurrency revolution!

For example, if a crypto trader enters the market by placing their first trade and the next week the asset falls by 25%, this is not the time to focus on the short-term. Instead, zoom out, look at the big picture, and don’t panic sell.


Avoiding all these common mistakes at the start of your crypto trading career will go a long way in helping you realize your trading potential. Planning your trading strategy, sticking to it, and using automations to execute your trading plan are all things you can do proactively to set yourself on the right course.

Luckily, you can do all of these things easily from Quadency’s unified portfolio management platform.

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Quadency is a cryptocurrency portfolio management platform that aggregates digital asset exchanges into one easy-to-use interface for traders and investors of all skill levels. Users access simplified automated bot strategies and a 360 portfolio view with a free account.

Disclaimer: The content of this article is for general market education and commentary and is not intended to serve as financial, investment, or any other type of advice.