Protect Your Profits: 15 Mistakes to Avoid in a Bull Market

Author: Edgy

Compiled by: Deep Tide TechFlow

Despite the current good market conditions, most people will end up losing money when the bull market ends.

They will make some preventable mistakes that will cost them life-changing wealth.

So, here are 15 mistakes to avoid during a bull market (and how to prevent them):

1. Not Taking Profits

No one cares what the highest price of your portfolio was; what matters is what you still have at the end of the cycle.

Here’s an example of a system you can adjust based on your risk tolerance.

A small tip:

• If you feel like an investment genius or are taking screenshots to show off your gains, it’s time to take profits.

• Taking profits means converting some coins into fiat currency, stablecoins, or tokens for long-term investments, rather than putting them into riskier projects.

• Create an exit plan for yourself.

You may have developed some bad habits during the past two years of bear markets. Strategies from bear markets do not apply in bull markets.

Here are some examples of bad habits…

2. Focusing on Fundamentals Instead of Price Action

Bull markets are all about speculation.

Look for projects that meet the following criteria:

• Can generate hype

• Have a simple and understandable story. Can people understand why the price will go up in the future?

Too much fundamental analysis can ruin you.

3. Switching Positions Too Quickly

Remember how narratives in the bear market would appear and disappear within days?

Why? Existing market + lack of new liquidity = rapid shifts in market trends.

In a bull market, narratives last longer due to more liquidity. Don’t frequently switch positions and lose your profits.

4. Weakening Momentum

The total market cap of cryptocurrencies has risen by 100% in the past few weeks.

You think it’s "too expensive," and you wait for a pullback that will never come.

It could go up another 10 times because this is a bull market.

Price is a narrative.

5. Riding the Trend

You must identify trends early, ride them as much as possible, and get off before they stop.

• Identify trends early (catch the wave)

• Invest (ride the wave)

• Take profits along the way and exit before the crash

6. Not Thinking Like a Retail Investor

Crypto Twitter does not equal the entire crypto space. You will end up caught in the excessive flywheel effect and governance issues that no one wants.

You should spend time on TikTok, IG (Instagram), Reddit, and YouTube. To understand ordinary people, you must spend time with them.

7. Not Narrowing Down Narratives

Focus on 2-3 narratives.

I know you want to "catch every upward opportunity," but if you spread yourself too thin, you won’t have any advantage.

I believe the following sectors will perform well in this cycle:

• AI

• RWA

• LRTfi

• Depin

• Meme

• Brc20

• GameFi

• L1/L2

8. Chasing Too Much Yield

Staking tokens for airdrop points? Don’t do it.

Depositing tokens for an extra 8% yield? Not worth the risk of smart contracts.

Remember those fools who deposited tokens into Celsius for an extra 5% yield?

Don’t do that; they want your principal, not just your interest.

9. Panic During Pullbacks

There will be many pullbacks on the way to the peak. They are healthy and expected for the market.

During this time, don’t use too much leverage, or you’ll get liquidated.

Also, don’t try to predict every pullback.

10. Over-Diversifying Investments

I’ve seen people post portfolios online with over 25 tokens.

You can’t keep up with that many projects.

And if one token skyrockets, you won’t gain much on your total position.

I think 5-7 tokens is the best balance.

Here’s a simple portfolio for reference:

• Long-term hold: BTC, ETH, or SOL

• Narrative 1: Sector Alpha (leaders) and tokens with potential for excess returns

• Narrative 2: Sector Alpha (leaders) and tokens with potential for excess returns

• Narrative 3: Sector Alpha (leaders) and tokens with potential for excess returns

11. Chasing Comparisons

It’s easy for people to feel their profits are very average compared to others on Twitter.

The market has survivor bias; don’t FOMO too much.

I’ve seen this happen countless times.

• Your token can achieve 10x

• But you feel you’re underperforming compared to others

• Then you chase 50x returns, which ultimately leads to your downfall

• Ending up with $0 profit

Consider taking profits gradually and don’t compare too much.

12. Trying to Sell at the Top

No one can perfectly time the peak of a cycle.

Many people lose wealth because they try to sell at the "top," but the timing is off.

The solution? Gradually sell during the uptrend.

13. Revenge Trading

If I lose money in poker, I keep playing and become more aggressive in trying to win my money back. But that rarely works.

Don’t do this in cryptocurrency. When you’re losing money and feeling emotional, it’s a sign that now is not the time to trade.

14. Not Cutting Losses Quickly Enough

No one has a 100% win rate. Failing is acceptable, but holding onto losers is not.

Set some conditions before entering a trade. For example, if it drops more than 15%, cut your losses.

You might ask, "But what if I sell it and the price goes back up?"

But the reality could be:

• What if you hold it and it goes to $0?

• What if it stays stagnant while you could allocate it to another 10x token?

Your capital has an opportunity cost.

15. Understanding Investor Psychology

Remember, each cycle’s outcome is different. We can have shorter or longer cycles.

Stay flexible.

One thing remains constant: human psychology. Understand herd mentality and greed.

I know you’re excited about a rising market. But I’ve seen countless people halfway through, overestimating their abilities, leading to profit reversals.

Keep things simple and maintain a clear mind.