Anchoring and adjustment is a mental bias where people cling to the first number they hear—or the first price they see—and let it skew their future decisions. In the wild world of crypto, this shows up a lot, especially in how traders set their expectations.

Why it happens in crypto

This idea comes from behavioral economics, but it fits crypto like a glove. With markets swinging wildly and emotions running high, traders often latch onto a single price—say, an all-time high or a big prediction—and let that number shape every move they make, whether it makes sense anymore or not.

Real-life examples of anchoring and adjustment

Let’s say you bought Bitcoin at $60K. It drops to $40K. Now it’s hovering around $45K—but you refuse to sell, because in your mind, $60K is still the “real” value.

Alternatively, you hear someone say ETH is going to hit $10K. That number sticks with you, so even when market conditions shift, you’re still making decisions based on that prediction.

These “anchors” might be totally arbitrary, but they can seriously mess with your judgment.

Anchoring bias can quietly wreck your trading game. It leads to:

• Holding onto bad trades, hoping they’ll bounce back to some magic number
• Selling good positions too early, just because they hit a price target you had in mind
• Creating artificial support and resistance levels that aren’t backed by actual market data

It’s one of the reasons crypto traders struggle to stay flexible—and why so many get blindsided by big market moves.

How to dodge the trap

• Focus on current data, not what a coin used to be worth
• Set stop-losses to keep emotion out of the picture
• Remember: just because someone shouted a big price target on Twitter doesn’t mean it’s gospel—it might just be another anchor

Being aware of anchoring bias doesn’t mean you’ll never fall for it—but it does make it easier to spot when it’s happening and step back before you make a decision you’ll regret.