Lesson from over-sizing on $ETH pre-Shanghai upgrade

Looking back at the lead-up to the Shanghai upgrade, my biggest misstep was getting too comfortable with position sizing on $ETH. I'd had a few decent wins on smaller, short-term moves and started to feel a bit invincible. When the pre-upgrade volatility kicked in, I decided to lean in heavily on what I thought was a 'sure thing' bounce play, based on some on-chain data that, in hindsight, I probably misinterpreted through my own bias. The market, predictably, didn't care about my convictions, and the initial dip went deeper than my stretched stop would allow without taking a significant hit. The mental gymnastics of deciding whether to hold a larger loss or cut it quickly became the real issue. I ended up trimming a portion, but the capital tie-up and the mental overhead for the next few days were far more costly than the direct P&L impact. It's a classic reminder that the market doesn't owe you anything, especially when you start letting ego dictate your risk parameters.

The real lesson wasn't just about the dollar amount lost, but the subsequent emotional drain. It affected my judgement on other, smaller positions for the following week. The discipline around sizing, regardless of how confident the setup feels, is paramount. My playbook now has a hard cap on sizing for even the highest conviction trades, and it's a cap I rarely approach.