Why You Are Still LOSING MONEY On Pump.Fun [Common Newbie MISTAKE]

Summary

The video explains why many people lose money on Pump.fun, a crypto trading platform. Key reasons include using high slippage rates, which eat into profits, not taking timely profits, and improper trading strategies. The video emphasizes setting lower slippage and fees, using tools like Photon for better trade execution, and being cautious with low-holder coins to avoid coordinated dumps. It also highlights the importance of taking profits and cutting losses promptly. The video provides detailed tips for optimizing trades on Pump.fun and encourages education on meme coin trading for better results.

Takeaways

• 📉 High slippage settings on Pump.fun can result in buying and selling at unfavorable prices, eating into potential profits.
• ⚠️ Using very high slippage is only advisable for immediate sniping, otherwise keep it low to maximize gains.
• 📊 On Pump.fun, using tools like Photon to view 1-second charts can help in making more informed buy and sell decisions.
• 🔧 Adjusting slippage to around 5% and setting lower priority fees can help reduce unnecessary costs and improve trade outcomes.
• 💸 Transaction fees, especially for small trades, can significantly impact overall profits, so keep them as low as possible.
• 📈 Nearly all coins on Pump.fun trend back down to zero eventually; taking profits along the way is crucial.
• ⏳ Be patient and take profits strategically, particularly when you notice red candles or pullbacks in price.
• 🚫 If a coin is not showing momentum and is going sideways, it is usually better to cut losses and move on.
• 👥 A low holder count for a new coin can indicate potential coordinated sell-offs, leading to sharp price drops.
• 📚 Educating oneself on meme coin trading and using proper tools and strategies can significantly improve trading outcomes on platforms like Pump.fun.

Q & A

What is the main reason why users keep losing money on Pump.fun?

Users often lose money due to high slippage settings, not taking profits, and not cutting losses quickly enough.

How does setting a high slippage percentage affect your trades?

Setting a high slippage percentage can push your trade through at a much higher price than expected, cutting into potential profits.

When is it appropriate to use high slippage settings on Pump.fun?

High slippage settings are appropriate when doing an immediate snipe, buying straight after the developer because of expected quick price movement.

What are the recommended slippage settings for trading on Pump.fun?

It is recommended to use lower slippage settings, around 5%, especially when trading slower moving coins.

Why is it important to adjust priority and bribery fees when trading small positions?

Adjusting these fees is important because high fees can significantly cut into profits, especially when trading small positions.

What is the significance of taking profits during an uptrend?

Taking profits during an uptrend is crucial because most Pump.fun coins eventually trend back down to zero, and not taking profits can result in losses.

How should you react if a trade is not working out?

If a trade is not working out and the coin is moving sideways or down, it's advisable to cut losses or break even and move on to another trade.

What does a low holder count indicate about a new coin launch?

A low holder count indicates poor distribution and increases the risk of coordinated selling, which can lead to a sharp price drop.

Why is it rare for coins on Pump.fun to stay at high levels doing nothing?

It's rare because the platform's traders are typically looking for quick gains and will sell off if the coin is not showing upward momentum.

What advantage does using tools like Photon offer when trading on Pump.fun?

Using tools like Photon provides better visibility and control over trades, such as setting advanced slippage and fee settings, which can help optimize trading strategies.

Outlines

00:00

📉 Common Pitfalls in Crypto Trading

This paragraph discusses the frustrations of trading various tokens on the Pump.fun platform, highlighting the experience of seeing wallet balances decrease despite successful trades. It introduces the video’s goal to explain why users often lose money on the platform, primarily due to overlooked factors, such as high slippage settings during buying and selling. The paragraph emphasizes the importance of understanding these settings to avoid significant losses.

05:02

🔧 Using Tools to Optimize Trades

This section focuses on using advanced tools like Photon for trading on Pump.fun. It advises traders to lower their slippage settings to around 5% to avoid unnecessary costs and discusses adjusting priority and bribery fees to optimize transaction costs. The emphasis is on minimizing fees and slippage to preserve profits, particularly when trading smaller positions.

10:04

💡 Take Profits and Manage Risk

This paragraph stresses the importance of taking profits during trading. It explains that most coins on Pump.fun eventually trend back to zero, so traders should take profits as the value rises. The advice includes setting sell percentages to manage trades effectively and being patient to sell at the right moments to avoid holding coins that will eventually lose value.

⚠️ Cutting Losses and Moving On

This part discusses the necessity of cutting losses or breaking even when trades are not performing well. It suggests monitoring transaction volumes and holder counts to determine if a coin has potential or if it is better to move on. The paragraph highlights the importance of recognizing when a trade is not working out and the benefits of moving on to other opportunities.

📊 Understanding Holder Distribution

This paragraph delves into the significance of holder distribution in meme coins. It warns against coins with low holder counts, as they are prone to coordinated selling and rapid price drops. The advice is to seek coins with a higher number of holders to ensure better distribution and stability, reducing the risk of sudden dumps.

📈 The Potential of Meme Coins

This section discusses the current trend and potential of meme coins in the crypto market. It emphasizes that meme coins have been performing well and offer daily trading opportunities, unlike long-term holds like Solana. The paragraph encourages traders to educate themselves to capitalize on the remaining months of the bull market, hinting at available resources for learning more about successful meme coin trading strategies.

📚 Education and Continuous Learning

The final paragraph promotes the importance of continuous education in crypto trading, particularly with meme coins. It mentions the availability of a comprehensive training program with numerous modules on Pump.fun, encouraging viewers to invest in learning to gain an edge in trading. The section concludes by inviting viewers to subscribe to the YouTube channel for more tutorials and updates on effective trading strategies.

Keywords

💡Pump.fun

Pump.fun is a trading platform mentioned in the video where users can trade various tokens, including meme coins and celebrity tokens. The video discusses how users often end up with lower wallet balances despite making profitable trades due to overlooked factors like slippage and fees on Pump.fun.

💡Slippage

Slippage refers to the difference between the expected price of a trade and the actual price at which the trade is executed. The video explains how high slippage settings, such as 25%, can result in significantly higher purchase prices, reducing potential profits.

💡Meme Coins

Meme coins are cryptocurrencies that are often created as jokes or memes. The video highlights the cycle of meme coins on Pump.fun, noting their potential for quick profits but also the high risk of losing money if not traded carefully.

💡Priority Fees

Priority fees are additional fees paid to speed up transaction processing on the blockchain. The video advises lowering priority fees to avoid cutting into trading margins, especially for small trades, as higher fees can significantly reduce profits.

💡Photon

Photon is a tool recommended in the video for better trading on Pump.fun. It offers advanced settings and features such as one-second charts and custom filters, helping traders execute more precise and profitable trades.

💡Taking Profits

Taking profits involves selling a portion of one's holdings to secure gains before the price potentially drops. The video emphasizes the importance of taking profits at various stages of a coin's rise to avoid losses when the price inevitably falls back to zero.

💡Rug Pull

A rug pull is a scam where developers abandon a project and run away with investors' funds. The video mentions that traders have experienced rug pulls with certain tokens, highlighting the risks involved in trading on platforms like Pump.fun.

💡Market Cap

Market cap, or market capitalization, refers to the total value of a cryptocurrency's circulating supply. The video suggests monitoring the market cap and holder distribution to assess the risk of coordinated selling and potential price drops.

💡Holder Count

Holder count is the number of unique addresses holding a particular token. The video explains that a low holder count can indicate a high risk of coordinated selling, which can rapidly drive down the token's price.

💡Break Even

Breaking even means selling a token at a price that covers the initial investment, avoiding losses. The video advises cutting losses or breaking even if a trade is not performing well, rather than holding onto a position that is unlikely to recover.

Highlights

Understanding slippage and its impact on trades is crucial. High slippage settings can significantly cut into profits, especially on fast-moving platforms like Pump.fun.

Setting slippage too high can push your trade through at a much higher price than expected, which can erode potential gains.

Lowering slippage to around 5% can help ensure transactions go through while protecting profit margins.

Transaction fees, including priority and bribery fees, should be minimized to avoid eating into profits, particularly when trading small positions.

It's essential to take profits during upward trends before the coin potentially crashes back to zero, which is common with Pump.fun coins.

Using tools like Photon to monitor new coin launches and set appropriate trading parameters can provide a strategic advantage.

Proper holder distribution is vital; coins with only a few holders can see dramatic price drops if just a couple of them sell.

Coins on Pump.fun often trend towards zero over time, so timely profit-taking is key.

If a coin is not showing momentum or is moving sideways, it's often better to cut losses or break even rather than holding on.

Monitoring holder count and transaction volume can provide insights into a coin's stability and potential for coordinated dumps.

Educating oneself on meme coin trading strategies is critical for navigating the fast-paced market and maximizing profits.

The current bull market for meme coins might not last long, making it important to learn effective trading strategies quickly.

Utilizing advanced trading settings and being patient for the right market conditions can improve trading outcomes.

The speaker offers a comprehensive training program with numerous modules focused on Pump.fun strategies, aiming to fill knowledge gaps and improve trading success.

Regularly updating trading knowledge and staying informed about new strategies can provide a competitive edge in the volatile meme coin market.

Transcripts

so you've been trading for a while on

pump. fun you've tried your fair share

of trump token celebrity tokens and

you've had some that are rugged but

you've had some where you've made some

good multiples and you definitely

remember selling for a price higher than

what you bought in for much like this

coin but then you check your wallet and

the balance is just lower than when you

first started sometimes a lot lower

sometimes you're near zero and you're

like what the hell is going on this

video I'm going to show you exactly why

a lot of you keep losing money on pump.

fun and it's for a few simple reasons

that you're just overlooking so if

you're in this situation where Wallet

balance keeps going down and you don't

think you're doing too bad then

definitely watch the entirety of this

video so we're going to start simply

with the buying and selling so let's say

I was looking to buy and sell this coin

and you're using pump. fund and you

connect your wallet you've got the

option here in the top right to connect

your wallet so let's say we're using the

native platform when you come here on

the buy and sell you've got the both

buttons here you can see here you can

buy and sell exactly what you want in

Soul where when you're selling you can

sell a specific percentage but you've

got a Max slippage button here so this

is the the first reason when you click

on this you'll find a lot of the time

the default settings are a lot higher

sometimes it could be 20 or 25% or

sometimes you're following people who

have told you to do it higher now the

only time I use very high slippage with

pump. fun is if I'm doing an immediate

snipe literally when the dev's buying

I'm just buying straight after because I

think something's going to move and pump

really really quickly but otherwise it's

rare you need to use high slippage

amounts like this and the problem with

the slippage so let's say we set it at

25% the problem with this is very very

simple when you then buy and you think

you're buying for one let's just call

the value of the coin one at that

particular moment in time and you set

your slippage to 25% or even higher it

will actually push your trade through at

something much higher sometimes it could

be 1.2 or 1.25 doesn't seem like a big

deal but a lot of the time on pump. fun

where we're barely looking to make a 2X

um as almost a best case scenario

sometimes three four or 5x if it's going

really well but barely it will cut into

that 2x a lot and if you're doing 25% on

the buy side 25% on the sell side and

then you've got some commission fees to

pay as well in terms of priority fees

and stuff like that you're not going to

be left with very much by the time you

sell and also because the price is

moving so quickly which you can't see

here on a standard pumped up fun chart

that's another reason why you're

probably buying higher than what you

think and I'll show you a few uh really

good tricks to kind of get around that

issue so I'm going to jump here to uh

Photon and this is really good when it

comes to trading on pump. fun the link

is in the description below so just

click on the link and you'll come to a

page like this where you can go onto new

pairs now here what you can do is if you

click on dex's here you can choose pump.

fun so literally all you'll see if you

reset all of this it just new launches

onp pump. fun I've got my own filters

that I use and set up and I've shared

that in a previous video but basically

here when you click on one of these new

tokens let's just click on another Trump

one cuz that's all we ever see here you

can see here we're on a 1 second chart

now on a one second chart because

everything's happening so quickly when

you click your buy order and it takes a

few seconds to go through then rather

than seven you might be buying for

8,000 so one of the things you need to

consider here is on the right hand side

where it says buy and sell you can uh do

some advanced settings here which are

better than just general pump. fund way

better and here you can set your

slippage but I would suggest lower so if

you're buying something and it's a few

minutes into the new coin launch so it's

not literally a second after launch go

with a lower slippage way lower go for

something like 5% try trading with that

and see if your transaction goes through

a lot of the time for me if I'm trading

these slower moving uh coins then 5% is

plenty and here on the priority fee you

can adjust this if you want to 01 and

015 bribery and if you're transaction

going through that's fine if you find is

going through a little bit slow

depending on your trading Style and what

type of coin you're actually trading you

can increase this a little bit for

example priority you can 2x so or you

basically just type in

02 and here for briber you can type in

02 as well but just remember anytime you

increase these types of fees it's

cutting into your margin again because

especially if you're just trading with

very small positions if you're buying

and selling for $20 here and there and

you're uh getting charge 01 or 02 salana

you have to remember what that converts

to so for example 05 salana do the maths

if you multiply that by 160 you're

coming into around $8 in just

transaction fees so if you're getting $8

cut off your position every single time

and you're only tra trying to trade $20

positions you're going to be in a bit of

trouble so you need to set these as

default or even reduce these and again

as long as the transactions going

through it doesn't matter the whole

point of setting this up is just to make

sure it goes through so set it up as low

as possible for for your own trading

style so in terms of position style

you're trading and if you find it's not

going through increase it a little bit

but don't just set this ridiculously

high otherwise it's going to cut into

all of your profits so be very careful

with that next major reason and this is

a big one as well you can see this coin

doing particularly well but most coins

at some point 20 30k they'll have dips

and they'll go back down then back up

then back down and then eventually

they'll they'll turn back to zero it

doesn't matter if it's now then after it

gets the radium they all turn back to

zero now if I told you that literally

nearly every single coin on pump. fun

Trends back down to zero what do you

need to do during the phase that things

are still going up before they take a

turn you must take profit profits people

still don't do this because they think

every single coin is going to be a

celebrity coin that goes to 10 million

it's not it's a very very small

percentage as it's going up here if you

hell from here all the way to here

that's really good but that's not good

trading though you really should take

profits because you don't know when this

is going to turn and head straight back

down to zero as a lot of the Pumped Up

fund coins do so at 20 for example 30k

take some profits when you go into the

sell button here and scroll down you can

see it set at 25% and you can adjust

these buttons If you want to so you can

even make it like 10 10% 20% 50% Etc so

you can mess around and play around with

these at the same time you need to be

patient with pump. fun because things

move so quickly in literally seconds to

a few minutes if it's literally going up

in a straight line and you've not seen

any selling don't just randomly take

profits I mean take profits if you're

seeing a pullback you're not seeing any

on here so you could have easily held

through this because there literally is

no pullbacks but if you look at another

ones let's just click on another random

one you probably seeing some of these

other ones yeah you can see here and

when we got to 25 look how sharp it sold

off so as it was beginning to sell off a

little bit you saw a couple of red

candles take profits so if you took

profits there you're still doing all

right but if you got in very early let's

say you got in at 13k and you didn't

take profits because this could have

kept going up but if you saw some

selling and you took profit you still

made from here to here and then you

could sell out of your position and

still move away making money but if you

didn't take profits and you're just

holding you're going to be holding for a

loss here because all of your position

is still in big big mistake most people

make when it comes to trading on pump.

fun so the main take home point is use

proper tools photon is one example Link

in description set your slippage

properly don't just set it on very very

high because that's just going to cost

you a lot of money reduce everything

down reduce the priority fees bribery

fee uh slippage everything right right

down especially if you're trading very

small positions if your transaction

doesn't go go through it's not the end

of the world um when you when it comes

to the buy side anyway it's okay you can

move on to another coin you'd rather

actually make real profits and not have

all your profits eaten into and then

next you must take profits along the way

you have to take profits along the way

with pump. fund and the reason is very

simple even more than Dex screen is

because everything goes to zero and they

go to zero very very quickly obviously

after they pumped we don't know how high

it's going to pump and because you don't

know you must take profits anytime you

see weakness in terms of selling it so

so far we've talked a lot about buying

taking profits but what if the trade is

not working out let's talk about that as

well so let's look at some of these that

are a little bit lower market cap and

let's see what we can do here

so this is now at 9k and let's say a few

minutes have gone by and it's doing

nothing so it's going sideways doing

nothing and you look down you scroll

down to transactions click on

transactions here and um you see you can

uh scroll here by the way and you can

sort it by descending and ascending as

well so if you want the most recent for

example you can sort it out that way too

so if you just click on the top you get

the most recent ones so let's say you

had a look here it's been 2 3 minutes

nobody's buying

anything all the transactions have gone

way down the holders count still looking

low so you're looking at the volume here

you're like what's going on here so so

what you need to do here if it was going

sideways this one's still going up a

little bit but if it's going down or

going sideways and doesn't look like one

of those Runners the runners that just

keep going up within a few minutes on

pump that fun if it's not

that this very rarely on pump. fun have

I ever seen a coin that goes up stays

sideways for 30 minutes goes up a bit

stay sideways for 30 minutes doesn't

work like that on here everybody's too

gy on here to let a just randomly just

stay at higher levels doing nothing very

very rare I see that after a new launch

very rare so what you should do is cut

losses it's another good tip as well or

break even depending on where your entry

is but just move on more times than not

at least 95% or more of the time when

I've done this myself with my trading

and just moved on if a coin's not

working out it's usually being the right

thing to do cuz like I said they all go

back to zero and if there's no more

momentum so the momentum this clearly

has momentum this Co but if you have no

momentum it's going to go back down and

another tip while I'm at it I mean so

many things I can share with you guys

but another tip here is the hold account

which I've discussed before as well but

if it's a new coin launch and it's at

10,000 or 12,000 so the market Cap's

okay but the hold account is like four

or five or six stay well away like the

hold account needs to go 20 30s 40s

that's natural good distribution if you

just got four or five five people

holding it and it's a market cap of like

12K like this is now and there just four

holders what do you think is going to

happen they're all going to coordinate

and sell at the same time and dump that

coin and take profits but if it's 30 or

40 holders if two of them sell the price

will go down a little bit but not that

much it'll give you time to get out but

there's only five holders and two of

them sell and the only ones left are you

the dev and one other random person is

going to be at 8,000 before you even

have a chance to sell so that's another

key Point as to why people lose money

because they get involved in the coins

where there's just not enough hold

account not enough distribution just the

general point about meme coins in

general look this is the cycle of meme

coins it's obvious it should be obvious

to anybody now like mean coins are the

thing in crypto that been doing really

well the last 12 months and it's set to

continue all the attention is on mem

coins so even you saw recently with the

celebrity meta as well and the great

thing about this compared to any other

cryptocurrency it's not like buying soul

and then waiting 6 to 12 months and then

selling it you can literally make money

daily like because you've got deck

screen and because you've got pumped up

fun if you know what you're doing and

you understand how mcoin trading works

you can absolutely make money daily but

the thing is you need to educate

yourself if you've been mostly losing

money with mem coins then you need to

fill in those gaps and you need to

consider whether it's worth it learning

how to do this properly because we might

only have 6 to eight months left of this

bull market so there's not long now to

cash in as much as possible that's why

second link in description on my

training program I've probably got close

to 100 modules now just on pump. fun

there's 14 already complete and I'm

adding another three or four more so

there's going to be about 20 tutorials

by the time I'm finished literally

everything you need to know about pump.

fun and a lot of people just they just

don't know this information that's what

gives you an advantage and an edge by

the way if you invest in this you get

lifetime access so all these last three

or four sections these are all bonus

ones I've continued to add if I come

across any new strategies that are

working when it comes to mem coin

trading I add them here so if you

interested second link in description

below I have many many free video

tutorials on my uh YouTube channel as

well so make sure you subscribe turn on

notifications because I'm regularly

going to release new tutorials like this

one so if you found this helpful make

sure you subscribed and if you're new to

my channel check these out they're very

very comprehensive and some of these

literally take you through everything

you need to know on some of these

platforms that's it for this one thanks

for listening