📖 100 lessons from the market | #19
Why do most traders buy at the peak... and sell at the bottom?
It may seem illogical, but it happens every day.
When a trader sees consecutive green candles, they start fearing missing out, so they buy after the price has already made most of its move. And when they see consecutive red candles, the fear of losing more takes over, so they sell after most of the drop has already happened.
The problem isn’t in reading the chart—it’s in making emotion follow price movement.
A professional trader isn’t drawn to strong momentum just because it’s strong. Instead, they ask:
"If I enter now... who will buy from me later? And is the risk-to-reward ratio still in my favor?"
Sometimes the best trade... is the one you don’t take.
🎯 Practical example with $BTC
Let’s assume $BTC has surged significantly in just a few hours, and everyone starts talking about the continuation of the rally.
Instead of rushing to buy, wait:
Has the price returned to test the breakout area?
Is the risk-to-reward ratio still suitable?
Is your entry based on a plan... or on fear of missing out (FOMO)?
If your last answer is “fear of missing out,” then it’s best to let the trade play out.
Why do most traders buy at the peak... and sell at the bottom?
It may seem illogical, but it happens every day.
When a trader sees consecutive green candles, they start fearing missing out, so they buy after the price has already made most of its move. And when they see consecutive red candles, the fear of losing more takes over, so they sell after most of the drop has already happened.
The problem isn’t in reading the chart—it’s in making emotion follow price movement.
A professional trader isn’t drawn to strong momentum just because it’s strong. Instead, they ask:
"If I enter now... who will buy from me later? And is the risk-to-reward ratio still in my favor?"
Sometimes the best trade... is the one you don’t take.
🎯 Practical example with $BTC
Let’s assume $BTC has surged significantly in just a few hours, and everyone starts talking about the continuation of the rally.
Instead of rushing to buy, wait:
Has the price returned to test the breakout area?
Is the risk-to-reward ratio still suitable?
Is your entry based on a plan... or on fear of missing out (FOMO)?
If your last answer is “fear of missing out,” then it’s best to let the trade play out.
