After years in the crypto space, I’ve discovered a harsh truth: the dividing line between winners and losers isn’t IQ or effort, but discipline.

Watching people around me repeatedly lose money in market analysis, I started to reflect on this phenomenon. Some have studied wave theory and golden cross patterns, others stare at candlesticks for hours every day, but why can’t they escape the classic curse—seven losses, two break-evens, one profit?

Later, I realized that many people think trading is too simple. They believe it’s just about buying low at good opportunities and selling high, sounds easy, but when they actually use their own capital to trade, everything changes. Most failures are psychological, not technical.

Let me share some of my own pitfalls over the years and discuss the four most common traps in crypto trading, along with how to get out of them.

**Trap 1: Trading purely on gut feeling**

Reasons for entering a trade are all over the place: a coin is trending recently, it’s fallen so much it must rebound, or just because you’re itching to trade. Honestly, that’s not trading, that’s gambling.

I used to do the same. In the mornings, I’d see some positive news and impulsively enter a position; if the price moved against me, I’d panic. Should I hold or cut losses? No idea. In such situations, having a trading plan or not makes no difference—both end with getting stopped out.

The solution is straightforward: build your own trading system. I’ve found that those who consistently make money may not be the most technically advanced, but they all have a systematic set of trading rules and can stick to them strictly.

This system should include key components:

Clear entry signals—not some mystical “feels like it’s going up,” but specific conditions. For example, a breakout of a key resistance level on increased volume, or a golden cross signal from a particular indicator.

Defined stop-loss levels—before entering, decide at what price you’ll cut losses if wrong. My personal rule is to have a clear maximum loss limit for each trade.

**Trap 2: Frequent trading leading to high fees**

This trap is particularly sneaky. Some people think they’re good at trading and want to participate in all market movements, ending up trading dozens or even hundreds of times a month. Each trade incurs fees, which seem small individually but add up to a huge cost over time.

More painfully, frequent trading often means rushed decisions and impatient psychology. I’ve seen many accounts double in a day only to lose it all back within a few days. During such rapid fluctuations, emotional control is nearly impossible.

**Trap 3: Over-leveraging on a single coin**

In crypto circles, it’s common to hear people say certain coins will definitely rise or are severely undervalued. Then they go all-in, and if the market moves against them, they get liquidated. I’ve seen too many stories like this.

The most basic risk management rule is diversification. Even the best opportunities shouldn’t be bet all your assets on, and professional traders don’t do that either.

**Trap 4: Letting short-term volatility wreck your mindset**

Crypto markets are highly volatile—that’s both a feature and a curse. Many enter with high hopes, only to see their account halve within a week, causing their mental defenses to collapse. They should hold on when they should, and cut losses when they should, but instead they panic or stubbornly hold.

My advice is to extend your trading cycle. Don’t focus on minute- or hour-level fluctuations; that’s too easy to let emotions take over. Look at daily and weekly trends to give yourself space for calm decision-making.

Honestly, rules and discipline are the most valuable assets in trading. Technical analysis and market research are helpful, but what really helps you survive longer and earn more steadily in risk management are those seemingly boring, dull trading disciplines.