5 Rookie Mistakes That Can Wreck Your Trading Account
5 Key Takeaways:
- Don’t Ignore Hidden Costs: On most exchanges you only see the spread and slippage after you trade. On Ouinex you see them in real time and can control maximum negative slippage.
- Don’t Over-Leverage: Margin trading is fantastic for improving profits, but make sure risk management is front and center.
- Don’t Get Caught up in Emotional Trading: Create a strategy and stick to it.
- Don’t Ignore Market Trends: Stay alert to the news, or set automated alerts to get pinged when certain market conditions are met. Ouinex offers both in-app news and automated alerts.
- Don’t Trade on an Exchange Using the CLOB: For NYSE the CLOB works brilliantly, but on crypto exchanges retail traders compete against massive financial institutions…and you can guess who has the upper hand then. Ouinex uses a no-CLOB execution model.
5 Rookie Mistakes That Can Wreck Your Trading Account
So, you’re ready to dive into crypto trading? Buckle up. The market’s fast, ruthless, and full of pitfalls that can drain your balance before you even realize what hit you. On the upside, once you learn to trade smart, it can do wonders for your bank account. Here are five rookie mistakes that could cost you big and how to avoid them.
1. Ignoring Hidden Costs (They’re Not Hidden on Ouinex)
You make a trade. You think you’re up. Then you check your P&L and... where did your profit go?
It’s called slippage. Or the spread. Or fees that most crypto exchanges conveniently fail to highlight. These “hidden” costs chip away at your gains trade after trade.
On Ouinex, we don’t play that game. Our execution model makes slippage transparent, spreads visible, and fees minimal. That’s to say: you can see your estimated slippage and spread* in real time as you trade and set the maximum negative slippage** you allow (and unlike other crypto exchanges we pass on positive slippage!). Plus, you can easily check your trading fees at any time they start at 0.18% and go as low as 0.05%.
Learn more about spot crypto fees here…for derivatives, there are no fees but the spread!
*Spread is the difference between the ask and bid price and that difference is pocketed by the exchange and the market makers. Learn more in our glossary.
**Slippage is the difference between the price you click to execute at and the price you get (volatile markets and low liquidity can cause slippage). Learn more in our glossary.
2. Trading on a CLOB-Based Exchange (Unless You’re a Hedge Fund)
Crypto exchanges love the Central Limit Order Book (CLOB). And it works great…if you’re an institution with deep pockets, algorithms, and VIP execution speeds. But if you’re a retail trader? You’re playing a rigged game where the big guys see your orders, jump ahead, and leave you with leftovers. Basically, they trade faster than you so they get the best prices, and you get negative slippage. And as they can see inside the order book and have enough cash to manipulate the market, you’re always trading at a disadvantage.
Ouinex eliminates the unfair advantage institutional traders have with a no-CLOB execution model. Institutions can only make prices, not take them. No more front-running. No more getting sniped by faster traders. And no manipulative tactics like spoofing and stop hunting.
3. Overleveraging (Fastest Way to Wipe Out Your Account)
Leverage (i.e. putting down a deposit and the exchange providing you with 10, 20, 100, or even 500 times that amount to trade with) is like a loaded gun. Handled with skill, it’s a powerful tool. Used recklessly, it’ll blow up your balance. New traders often get tempted by 50x or 100x leverage, only to get liquidated in minutes.
Stick to risk management. Understand your exposure. If you wouldn’t bet your whole paycheck on a single hand of blackjack, don’t do it with leverage.
4. Emotional Trading (Your Worst Enemy)
Markets don’t care how you feel. But if you let fear, greed, or FOMO control your trades, you’re handing your money to traders who stay disciplined as they’re the ones who will win at the end of the day. Revenge trading after a loss? FOMO buying because Twitter says a coin is pumping? Panic selling at the bottom?
All classic ways to drain your account. Have a strategy. Stick to it. Our automated trading alerts can help you with that. You get pinged when specific market conditions are met. Such as BTC going up, while the Dow Jones also goes up. Set as many variables as you like.
5. Ignoring Market Conditions (News Moves Markets)
Trading in a vacuum is a bad idea. Crypto exchanges react to global events, regulations, and even Elon Musk tweets. If you’re not paying attention to macro trends, you’re not trading you’re gambling.
Follow news. Watch key levels. And remember: the market doesn’t care about your opinions, only price action.
Again, Ouinex’s automated trading alerts can help you stay on track. Plus, we offer in-app news. And if you build your own algorithm or use a trading software, you can plug into our API. .
Bonus: Not Understanding How Derivatives Trading Works
Crypto trading isn’t just spot markets. Many traders jump into derivatives trading (crypto perps) without fully understanding leverage, margin calls, or funding rates. That’s a fast track to getting rekt.
Know the product you’re trading. Whether it’s futures, options, or perpetual contracts, make sure you understand how the mechanics work before you take on unnecessary risk.
Be smart. Try your trading strategy using a demo account before you get going. Sign up for one here.
Bonus: Blindly Following Trading Signals
There’s no shortage of so-called experts handing out buy and sell signals. But here’s the truth if they were always right, they wouldn’t be selling signals, they’d be trading full-time.
Use signals as a tool, not a crutch. Verify strategies. Understand market conditions. And most importantly, never trade blindly.
Bonus: Hype is a Trap
A coin's pumping? Everyone's screaming "buy!" FOMO kicks in. You jump in... and then the price dumps. You're left holding the bag. Chasing hype is a sure-fire way to lose your shirt. Ignore the noise. Do your own research. Find solid projects.
Sum Up
The main thing to remember as a new trader is to educate yourself and stay away from hype. Trading is not about luck, but skill. Understand what it’s all about, find strategies that work for you, and choose an exchange where there aren’t any hidden fees and you aren’t forced to compete with massive financial institutions.
Most crypto exchanges are built for institutions. Ouinex is built for retail traders who want a fair shot. We aren’t Robin Hood. We don’t take from the rich and give to the poor, but we do level the playing field so everyone has a chance to win at crypto. Try our demo trading platform it’s 100% free and you can test out any trading strategy before investing real hard cash (crypto). It’s the perfect way to learn. You can also head to Ouinex Academy for more trading tips, or why not make your way to our glossary to learn all the different trading terms?