Investors and traders make a lot of mistakes while trading currencies, which have incurred losses, including the seven most expensive errors:
First trading based on feelings of fear, anxiety or news:
When a person trades on the basis of his feelings rather than technical analysis, he is very likely to lose, and the same is when a person focuses on news and forums and trades on them.
For example, the Wall Street Journal reported that the Securities and Exchange Commission will hold a meeting on May 7 to determine whether etherium is securities. For those who focus on the news, this news would make them invest in etherium, Its price dropped from $ 793 to $ 743 after the agency denied this information.
Instead of relying on media and intuition, a trader must develop a strategy for using indicators, analysis and data collection.
Second, use the wrong tools:
Not all digital currency products are suitable for daily trading, and some can ultimately limit a person's ability to trade effectively. These include cold storage solutions such as Tresor and Ledger portfolios. The amount of signature and confirmation of transactions from portfolios can lead to delays in transactions.
Instead, the trader should place the currencies he wants to trade on a daily basis in the trading platform and look for suitable daily trading instruments such as "U2F".
Thirdly, entering into a position that can not be avoided:
Some trading platforms may be somewhat illiquid and therefore do not have enough buy orders to support selling digital currencies easily at a good price at any moment. There are platforms with adequate liquidity but low trading volumes on public holidays and weekends.
If a trader is stuck in a non-liquid position, he may lose a great opportunity to profit and be forced to stay for a long time in a position he does not want.
To avoid these positions, the trader should try to avoid times of market liquidity decline such as night time and weekends, and consider increasing the liquidity that can be accessed by trading on a system that allows access to many different stock exchanges simultaneously, rather than trading in Single Stock Exchange.
Excessive technical analysis:
It is important to think about developing an appropriate daily trading strategy rather than relying on emotions, but at the same time it may be wrong to focus too much on technical indicators and ignore what is actually happening in the market.
So one has to mediate between reading indicators, technical analysis, tracking market news, and thinking logically.
V. Failure to consider the appropriate data:
It's easy to look at the top of the podium and the belief that this currency rate represents the price a person gets for trading, but this is not the fact that the amount of digital currency offered by people to buy or sell at the top of the podium is often very low. This means that if someone wants to sell or buy a large quantity, you should go deeper into the list of applications for the platform to find a party that offers an appropriate price.
Sixth, not to use appropriate hedging strategies:
Risk management is the most important aspect of day-to-day trading. If a person does not know how to calculate the time value of risk or to use multiple hedging platforms in transactions, he is at risk.
Therefore, a person likes to use multiple exchange platforms. If there are signs of a market frequency, he buys low-priced currencies on one platform and sells some currencies at the highest price on another platform, thus reducing the risks.
Seventh: Daily trading in general:
Daily trading requires a lot of time and effort, and can make the person short-sighted in long-term market trends. By focusing on daily trading, a person may lose a lot of potential profits.
Instead, a person can buy a currency that secures its own goals and technology, and hold them for a long time, which is less stressful and more profitable than daily trading.
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