A crypto trader found themselves in a precarious position this week after hastily trading two newly launched tokens that saw double-digit price spikes, according to blockchain analytics firm Lookonchain.
The two tokens in question, GUMMY and MANEKI, were just launched this week but immediately experienced volatile price movements. The trader, caught up in the frenzy, made a series of seven trades over five days related to these tokens.
Unfortunately, the trader’s strategy backfired spectacularly. As Lookonchain explains, the trader exhibited classic “fear of missing out” (FOMO) behavior, buying the coins when prices were high only to panic sell after inevitable dips. Of the seven trades, six resulted in losses.
The end result was a total loss of 125.52 SOL for the trader – a staggering amount equal to over $20,000 at current Solana prices. Lookonchain did not identify the trader but used the analysis as a teachable moment about the perils of impulsive trading during market frenzies.
In a tweet, the firm warned: “Avoid being #PaperHand in trading. This trader has frequently traded $GUMMY and $MANEKI in the past 5 days…He was #FOMO and bought coins when the price was high, then panicked and sold after the price dropped.”
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Show more +The trader’s costly missteps highlight the risks of trading newly launched, volatile cryptocurrencies without a defined strategy and risk management in place. As the blockchain data shows, giving in to fear and greed can quickly derail even the most well-capitalized traders
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