Many people lose money trading cryptocurrencies, not because they choose the wrong coins, but because they make basic trading discipline mistakes. These errors seem simple but can deplete an account within three years.

**The three major traps to avoid first:**

chasing the rally and selling the dip is the number one killer. Data shows that 90% of retail traders fall into this trap—buying when prices surge and getting caught at the top. Successful, stable traders do the opposite, only entering when the market is bloodied and bottoming out.

going all-in on a single coin is a gambler’s mindset. Putting all funds into one asset is essentially no different from betting on a lucky number. Professional traders always keep 30% cash reserves, waiting for the dip to buy the bottom. When others panic, you’re already prepared.

full position trading limits operational flexibility. Opportunities in this market are always more than your capital. Being fully invested is like a hunter with bound hands and feet, only able to watch opportunities slip away. Proper position management is the moat of top players.

**Now, six trading principles:**

consolidation periods are the easiest to blow up. 80% of liquidations happen during sideways trading because this tests your psychology—no clear signals of rise or fall, and it’s easy to make impulsive mistakes. High-level sideways moves are often fake breakouts by manipulators; bottoming out at low levels often hides a sharp drop.

buy on bearish candles, sell on bullish candles. This seems counterintuitive, but large downward candles often indicate panic capitulation, making them good entry points. Greed during bullish surges often results in being caught at the top.

the severity of a sharp decline determines the rebound’s magnitude. Slow declines tend to lead to weak rebounds, while waterfall crashes can trigger fierce rebounds. When facing a sudden drop, don’t rush to cut losses; instead, prepare funds for the next move.

pyramid building at the bottom is most effective. Adding 10% on every 10% drop can lower your average cost to the minimum. This method has been used by Wall Street fund managers for decades.

**The final core rule:**

when a coin surges sharply and then consolidates, sell immediately. When a coin crashes and consolidates, don’t keep waiting. Time is cost; holding without action often incurs the greatest opportunity cost. Mastering the rhythm is more important than just holding your position.

This approach may seem simple and even dull, but behind simplicity are countless lessons learned through trial and error. Traders who stick to discipline grow their accounts steadily, not by luck, but by making the right choices every time.