Common Mistakes That Kill Crypto Prop Trading Careers

1. Lack of Research: 

The one thing that holds the most value in the crypto prop trading journey is the research skills of a trader. Before you jump in and start trading, it is important to do your research about each and every relevant thing. Starting from which crypto pair you want to trade to the platform you wish to use, you should be clear about it. Moreover, all this should not be based on what you hear on social media or from others, but purely on logic and your own research. The better the research, the more clarity you will have about what to expect, and the easier it will be to manage the situations in the future.

2. Overtrading: 

The more the merrier. Yes, you must have heard it a thousand times, but this does not hold true when you have a crypto trading career. Here, you have to be very mindful of the number of trades you are executing. Because it is better to trade less than to set reckless positions. This needs even more attention when you are trading with a crypto prop trading firm, because you get leverage and access to more capital. For example, at Hola Prime X, traders get 5x leverage, which allows them to trade big and make more profits. At the same time, it opens up more risk, which makes it very important to be mindful about the number of trades you execute.

3. Emotional Trading: 

Just like overtrading, emotional trading is another major mistake that crypto traders make and end up blowing their accounts. In the crypto trading career, there would be both the reds and the greens, and to be in profit, you just need to have more greens than reds. Here, the important thing is to be calm when some trades don’t go your way and take it as part of the journey. Once you have developed this mentality, it will help you avoid chasing immediate profits and stick to your trading strategy.

4. Following Influencers Without Discretion: 

Inexperienced traders often try to follow every new move they see on social media by so-called crypto traders and end up in losses. However, no matter how many smart moves you try to make based on the tips of influencers, you will never end up in a sustainable situation. Crypto trading is not about a few smart moves but creating a sustainable trading strategy that is based on research, logic, knowledge, and your risk appetite. Hence, if you are just starting out your crypto trading career, try to avoid following the influencers because each trader has their unique patterns and needs a personalized strategy that works for them.

If you need guidance or mentorship on starting your trading journey, it is better to rely on authentic and trustworthy resources. At Hola Prime X, we offer 1-on-1 coaching by top mentors in the trading industry to help traders get better at trading. Just join our Discord channel, where you can have conversations with different coaches and get guidance. 

5. Poor Risk Management: 

As we discussed above that to be in profit, you need to have more greens than red. Hence, if you can limit your losses, you can be in profit. For this, you have to follow a well-curated risk management strategy that gives you an idea about when you want to exit each trade so that you stay within your risk limits. 

6. Short-Term Thinking: 

Trading is not gambling, where you can get quick, big results and get rich overnight. In trading, you have to think long-term so that you can have sustainable profits. In the volatile market conditions, if you go for short-term profits and the market does not go the way you want, you can end up blowing your capital.

7. Having a Clear Strategy: 

Not having a clear trading strategy is like sailing without knowing which direction to go and the result for both is the same, you end up reaching nowhere. With a clear strategy, you will have an unequivocal idea about what are your profit targets, what is your risk limit, and more. This will help you in avoiding many of the common mistakes like overtrading, emotional trading, and short-term thinking.