Although the current market is good, when the bull market ends, most people will lose money.
They make preventable mistakes and lose life-changing fortunes.
So, here are 15 mistakes to avoid in a bull market (and how to prevent them):
1. Not taking profits
No one cares what your portfolio peaked at, what matters is what you have left at the end of the cycle.
Below is an example of a system that you can adjust based on your risk tolerance.
圖源：《MarsBit》
Tips:
If you feel like an investing genius or are taking screenshots to show off your gains, it’s time to take profits.
Taking profits means exchanging some coins into fiat currencies, stablecoins or tokens for long-term investment rather than investing in riskier projects.
Make a cycle exit plan for yourself.
Chances are you've picked up some bad habits during the last two years of bear markets. Strategies that work in a bear market do not work in a bull market.
Here are some examples of bad habits...
2. Focus on fundamentals rather than upside
Bull markets are all speculative.
Look for projects that meet the following criteria:
can generate hype
There is a simple and easy to understand story. Can people understand why prices will rise in the future?
Too much fundamental analysis will ruin you.
圖源：《MarsBit》
3. Changing positions too quickly
Remember how narratives appeared and disappeared in a matter of days during a bear market?
Why? Existing market + lack of new liquidity = rapid change of market hot spots.
In a bull market, narratives last longer because there is more liquidity. Don't make yourself lose profits by changing positions frequently.
4. Potential energy weakens
The total cryptocurrency market capitalization price has increased by 100% in the past few weeks.
You think it's "too expensive" and you wait for a pullback that never comes.
It will go up a further 10x because this is a bull market.
Price is a narrative.
5. Riding the trends
You have to spot trends early, ride them as hard as you can, and get off before they stall.
Spot trends early (spot waves)
Investment (riding the wind and waves)
Make profits along the way and get out before the crash
6. Don’t think like a retail investor
Crypto Twitter does not equal the entire crypto space. You end up with too many flywheels and governance issues that no one wants.
You should spend time on Tik Tok, IG (Instagram), Reddit, and YouTube. To understand ordinary people, you have to spend time with them.
7. Don’t narrow the scope of the narrative
There should be 2-3 narratives that you focus on.
I know you want to "catch every opportunity on the upside," but if you spread yourself too thin, you won't have any advantage.
I think the following sectors will do well in this cycle:
AI
RWA
LRTfi
Depending on
Meme
Brc20
GameFi
L1/L2
8. Pursuing excessive profits
Staking tokens to earn airdrop points? don't want.
Deposit tokens to get an extra 8%? It’s not worth the risk of smart contracts.
Remember those fools who deposited their tokens into Celsius to earn an extra 5%?
Don't do this, you want their interest and they want your principal.
9. Panic during pullbacks
There will be many pullbacks on the way to the highs. They are healthy and expected for the market.
At this time, the leverage should not be too high, otherwise the position will be liquidated.
Don't try to predict every pullback either.
圖源：《MarsBit》
10. Investments are too diversified
I've seen people post portfolios online before that have more than 25 tokens.
You can’t keep up with that many projects.
And if one of the coins goes up super high, you're not going to get that much return on your base position.
I think 5 - 7 tokens is the sweet spot.
Here is a simple portfolio for reference
Long-term holding: BTC, ETH or SOL
Narrative 1: Sector Alpha (leading) and coins that are likely to obtain excess returns
Narrative 2: Sector Alpha (leading) and coins that are likely to obtain excess returns
Narrative 3: Sector Alpha (leading) and coins that are likely to obtain excess returns
圖源：《MarsBit》
11. Pursue comparison
It’s easy to feel like your profits are mediocre relative to the profits of everyone else on Twitter.
The market has survivor bias, don’t be too FOMO
I've seen this happen countless times.
Your coins can achieve 10x results
But you feel that your performance is not as good as others
Then chasing 50x returns, which ultimately leads to your failure
Ended up with $0 profit
You might as well take profits gradually and don't compare too much.
12. Don’t try to sell at the top
No one can time cycle peaks perfectly.
Many people have lost fortunes because they tried to sell the "top" but didn't time it right.
solution? Just sell gradually during the rise.
13. Revenge trading
If I lose money in poker, I will continue playing and become more aggressive in trying to win my money back. But this rarely works.
Don't do this in cryptocurrencies. When you are losing money and are emotional, it proves that now is not the time to trade.
14. Stop loss fast enough
No one has a 100% winning rate. It's okay to fail, but it's not acceptable to persist as a loser.
Set some conditions before entering a trade. For example, if it drops more than 15%, cut your losses.
You ask, “But what if I sell it and the price goes up?”
But the reality may be:
What if you hold it and it goes to $0?
What if it stays stagnant and you could allocate it to other 10x coins?
There is an opportunity cost to your capital.
15. Understand investor psychology
Keep in mind that results vary from cycle to cycle. We can have shorter or longer cycles.
Stay flexible.
One thing remains constant: human psychology. Understand the herd mentality and greed mentality.
I know you're excited about rising markets. But I have seen countless people overestimate their abilities midway, resulting in profit taking.
Keep things simple and keep a clear head.
Disclaimer: This article does not constitute investment advice. Users should consider whether any opinions, views or conclusions in this article are consistent with their specific circumstances, and abide by the relevant laws and regulations of the country and region where they are located.
This article is reprinted with permission from: "MarsBit"
Original author: Edgy
Original source: twitter
Compiled by: Deep Wave TechFlow
