Avoiding Rookie Mistakes
“Every trader will eventually learn that the market punishes arrogance and rewards humility.” -Linda Raschke
Trading crypto perps can be exciting — but without discipline, it’s easy to turn a promising strategy into a blown account. This page walks through the most common rookie mistakes and how to avoid them with practical tips and mindset shifts.
1. Overleveraging
Mistake: Using 20x+ leverage on volatile assets hoping for quick gains.
Consequence: A 5% move against you can liquidate your position entirely.
✅ Fix:
• Stick to 3x–5x leverage as a max (or lower when starting out)
• Use smaller size with tighter risk instead of boosting leverage
• Focus on building capital through consistency, not gambling
2. Not Using Stop-Losses
Mistake: Refusing to set stop-losses because you “believe” the price will come back.
Consequence: You become a bagholder or get liquidated without a plan.
✅ Fix:
• Define your stop before opening a trade
• Use hard stops in volatile markets to limit downside
• Accept small, planned losses as part of the game
“Plan your exit before you enter.”
3. Revenge Trading After a Loss
Mistake: Doubling down or opening new trades emotionally after taking a hit.
Consequence: Stack losses quickly and blow up your account.
✅ Fix:
• Take a 15-minute break after every stop-loss
• Set a “2 losses per day” rule
• Journal what triggered the loss and move on
4. Ignoring the Funding Rate
Mistake: Holding a long position during extreme bullish sentiment and paying huge funding fees.
Consequence: Your PnL gets eaten by fees even if price stays flat.
✅ Fix:
• Monitor the funding rate before holding perps long-term
• If funding is high, consider reducing size or switching to spot
• Use exchanges with lower fees or zero funding windows during volatile periods
5. Going All In / YOLO Trading
Mistake: Betting your entire account on a single “high-conviction” idea.
Consequence: One mistake ends your trading journey.
✅ Fix:
• Follow a portfolio risk rule: never risk more than 2% of your total capital per trade
• Diversify positions and scale in if necessary
• Think long-term: capital preservation > short-term glory
6. No Trade Journal or Review Process
Mistake: Not tracking trades, emotions, reasons, or mistakes.
Consequence: You keep repeating poor behavior without realizing it.
✅ Fix:
• Maintain a simple trade journal with these fields:
• Setup / thesis
• Entry, stop, and target
• Outcome (win/loss and why)
• Emotions felt
• Review trades weekly and look for patterns (good and bad)
7. Chasing Pumps or FOMO Trading
Mistake: Entering trades after large green candles out of fear of missing out.
Consequence: You’re often the exit liquidity for early buyers.
✅ Fix:
• Have pre-defined entries based on setups, not emotion
• Set alerts and wait for pullbacks or confirmation
• Let the trade come to you — don’t chase
8. Trading Too Many Pairs at Once
Mistake: Trying to trade 5+ markets simultaneously without proper focus.
Consequence: Overwhelm, decision fatigue, and sloppy execution.
✅ Fix:
• Focus on 1–3 assets you understand well (like SUI, ETH, BTC)
• Specialize before expanding your scope
• Quality setups > quantity of trades
9. Not Accounting for Slippage or Liquidity
Mistake: Entering a large position in a low-liquidity market and getting filled far from expected price.
Consequence: Worse entry, poor stop fill, or unintended liquidation.
✅ Fix:
• Check the order book depth before entering
• Avoid trading obscure altcoins with thin books
• Stick to perps with high 24h volume and tight spreads
10. Believing You’re Smarter Than the Market
Mistake: Refusing to cut losses or adjust strategy because of ego.
Consequence: The market humbles you — hard.
✅ Fix:
• Be flexible. Adapt when market conditions change.
• Accept being wrong as part of the profession.
• Confidence is good — but humility keeps you solvent.
🧠 Golden Rule
“Your #1 job is not to make money. It’s to not lose money.
Approach every trade as a risk manager first, and a speculator second.
📌 Recap: Rookie Mistake Checklist
✅ Use stop-losses on every trade
✅ Don’t exceed 2% risk per trade
✅ Avoid revenge and emotional trades
✅ Monitor funding rates before holding
✅ Log and review every trade
✅ Focus on process, not outcome
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