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    Fear of Missing Out (FOMO) – Solutions?

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    Fear of Missing Out (FOMO) – Solutions?

    Hi Traders. Today’s I’m going to discuss “Fear of Missing Out (FOMO)”. It is a very common trait among new and experienced traders. Till present, I still have this ‘evil’ occasionally popping out leading to unnecessary loss. One thing to remind yourself is that emotion isn’t something you can eliminate completely. Human beings were made with emotions, what you can do is to organize your mind to control their performance.

    “Chains of habits are too light to be felt until they are too heavy to be broken” – Warren Buffett

    Constantly learning and practising, put knowledge as the priority is what you can do to improve your performance and ensure your mind is at its peak. Do the right thing. The illustration above isn’t a general representation of all, but for someone who’s regularly over-trading and revenge trading, this post is worth a read. Below I’ve concluded several points if you’re having FOMO.

    1. Emotionally triggered/ attached – During my early phase of trading, I was always emotionally triggered or shock by the market movement. Eg. “Why is it going up? Why is it going down? Why is it doing this? Why is it not doing this?”. First and foremost, the market movement is created by millions of traders (randomness). In the short-term, it is mostly driven by technicals, long-term mostly driven by fundamentals. No one has any control over the market movement or its direction (Unless you’re doing insiders’ trading). Do not try to impose your personal will or expectations in the market, because it simply doesn’t care. Trade what you see, conduct your due diligence, that’s it. If you’re always having that stubbornness thinking you must be right, it’s just a matter of time where reality hits and you’ll get hurt pretty badly.

    2. Not following your initial plan – To be consistently profitable, you need to tackle the market every day from the same perspective. You cannot allow yourself to constantly switch from one strategy to another. A consistent action plan generates a consistent result, put more attention into the process, not the outcome. “The eagerness to control the outcome is illusional” – Rande Howell

    3. Constant re-assessment (Overthinking) – If you’re a FOMO person, you’d tend to overthink a lot. “What If I don’t sell now It goes down? What If I don’t buy now It goes up?” You simply do not need to get involved in the market all the time to make money, profit comes when you’re doing the right thing over a long period of time.

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    4. Jump from one bias to another – From the illustration above, have you ever switch from long bias to short bias so quickly just because you “think” you’re wrong? Because of some sudden market movement, you unconsciously throw your initial plan out of the window then make some impulsive decisions. If yes, then from now onwards you MUST remind yourself that there are only 3 general directions in the market (Up/ Down/ Sideway). Stick to your initial plan or bias, unless you’re an experienced trader with great flexibility on spotting short-term momentum shift. Or else, simply allow the market to reveal whether you’re right or wrong. Avoid rotational market condition especially when you’re new to trading because it is usually where the majority tend to give back their hard-earned profits.

    5. No strategy/ game plan – Trading is not a get-rich-quick game. Work hard, study, and practice to improve your knowledge. It is a marathon, not a sprint, to succeed in this business you will experience failure. Never give up, and learn to make peace with your losses. As long as you stay in the business long enough, you will succeed. Put in the effort to back-test, it gives you the confidence to execute the same setup repeatedly as you have the data to back-up your mental capital when you’re having some terrible drawdown. Yes, I’ve seen traders who succeed without back-testing, but trust me it is very unlikely. Knowledge is power.

    6. Nervous/ panic – This is one of the common texts I receive regularly. “What should I do? I am currently down xxx $ amount”. Discipline is the toughest yet the strongest tool in trading. If you’re uncertain about your decision or the outcome, simply avoid them. The hesitation comes from fear, If you’re uncertain about a position, don’t take them. It makes no sense to put your money at risk on something that you don’t even know. Quality over quantity, focus on high probability setups. How do you assess the quality of a setup? Simply back-test them, then find out the long-term expectancy of the strategy.

    “The market is a device for transferring money from the impatient to the patient.” – Warren Buffett

    Comment down below what’s your worst losing streaks and what’s the underlying cause?

    Trade safe as usual.

    Do follow my profile for daily fx forecast & educational content.

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    TwistedJAChttps://jac9ja.ng
    JAC is the Founder of JAC9JA, SEO Consultant and has been in the cryptocurrency and blockchain space for just over three years. Fascinated by the community and everything that blockchain has to offer, JAC dedicated himself to creating content and contributing back to the industry.

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