Trading is a risky game, especially trading crypto on 10x leverage! One false move and you can get put in a bad situation. In this post I am going to talk about some lessons learned on my liquidated trade on a Solana short. You can look at these posts as my little trade journal. They key is to be honest about your wins and your losses!
The wins were coming solid over the last 2 days, playing 10x leverage trades at $100 at a time, which was playing with $1000 worth of crypto. I had made over $180 in the 2 days of trading, so I was feeling a bit too confident, and honestly got a bit cocky with myself.
Lesson Number 1
Indicators can fake you out. This is the number one lesson that crypto traders need to learn. we all lean on and have our favorite indicators and tools that we like to use. Well sometimes, those tools can fake us out and cause bad entry point if not used in conjunction with other tools. So, you cannot just go in on a trade based on one signal or indication, you need to confirm the move with price action, volume, and other indicators.
Lesson Number 2
Use MULTIPLE TIME FRAMES!!! This one is key! In my case I was so laser focused on the 1-5 minute time frames that I missed some indications of a reversal on the higher time frames that caused me to go short when I should have been going long. Again, this goes back to confirming your trade on multiple time frames and using multiple indicators.
Lesson Number 3
Riding the trend is more important than nailing the tops and bottoms of a trade. If you are super zoomed in, you can have a good chance of nailing some good scalps, but you can have them go the wrong way on you as well. It's best to make sure that the trend is in your favor. You want to be riding with the whales instead of swimming against them and the currents they are creating. Focus more on making your money in the middle of the trades than trying to hit the tops and bottoms.
Lesson Number 4
If you enter a trade and it starts to go the wrong way, GET OUT! Don't let it run thinking it will come back based on what you thought the move was going to make... Doesn't work out too well! That happened to me last night. I decided last minute, after telling myself I was done for the day, to get that one last scalp trade before I turned off the computer... Well that bit me in the ass something fierce.
I went in on a short, putting more than I should have into the position and low and behold, it lifted off and went to the moon, lol. I waited for a while to see if it would come back down, but it was too late. I woke up this morning and was still in the trade, which looked like it was finally heading the way I planned, but yeah, scammy liquidation spike took me out.
This leads me into lesson number 5, which is probably the most important lesson learned with this liquidation...
Use a freaking STOP LOSS, you idiot! I say this to myself, being my trading journal and all. Being that I am not playing with much money at all versus the big money players, it's not like I have to try and hide my orders from market makers. I was riding wild with my swinging thing in the wind on these trades which was extremely risky. Most of my trades during the day went great, but it was the one that killed the confidence.
Lessons Learned and Moving Forward
But hey, nobody and no strategy is perfect. You have to take the losses with the wins if you expect to get ahead in these markets. The biggest thing is learning from this loss. It wiped out over half of my trading account, again, because I was stupid and went too far into the trade trying to save it. So from here forward, I will be playing much smarter and not trying to do stupid things that shoot me in the foot, lol!
Not financial advice, but I got rekt so you don't have to! Learn from my mistakes and lets all make money together!
Until next time everyone..
Be Cool, Be Real, and always Abide!
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