I find it very awkward that even in this day and time, most spot traders are still buying only when the market is green, they buys at the top and when the market starts retrace they sell at a loss in panic, without knowing that when trading the spot market, where the profit is, is where you buy, if you buy when the price is down, their is a higher probability that you will win that trade by selling when the market is green, but if you are buying at the top when it's not Bitcoin, their is a higher probability that you may sell in a loss if the asset you bought fails to recover in an extended period of time, so the earlier most spots trader understand that buying and selling has their own time the better.
Buying when the market is green is pure herd behaviors, not even a strategy, when people see candles flying, FOMO kicks in and they rush to buy at or near the top. Then the moment the market retraces, which it always does, panic sets in and they sell at a loss. That cycle alone wipes out most spot traders. The funny problem most of them have is that they dont want to buy when it feels uncomfortable. Red candles look scary , green candles feel "safe", even though its the opposite. Spot trading requires patience and timing, not excitement (it will do you no good at all).
As a spot trader, until you understand that every phase has its purpose, (accumulation, expansion and distribution), you will keep donating money to the market. Buying and selling both have their time and missing that reality is why losses repeat
All you said here are true, and they all boils down to ignorance and lack of patience, I added lack of patience because I know of some spot traders that are scared of buying when the market is down because in their statements, they don't know when the market may start appreciating, so they don't have that luxury of time to wait till it starts appreciating, that is why they only start buying when they feels like they market has started rising, so I believes that it's not just lack of knowledge that makes spot traders buys at the top, but impatient is also one of the cause.
But one thing I know that is common among such traders is that they tend to panic and sell easily once the market drop drastically from the point they bought from, and that is why most of them always sell at a loss in the end, because they easily panic and they are not used to waiting for the asset they bought to appreciate back.
