Fear. Anxiety. Stress. Impatience. Agitation. Suspense. Live dangerously. Go for broke.
Chances are, if you’ve felt any of these emotions while trading in the crypto markets then you’ve gone through a bout of FOMO. That’s right, the Fear Of Missing Out. And depending on its hold, your self-control or lack of it and your disposable cash, you’ve probably dived in when you should have sit out a trade. Sigh. It happens to all of us.
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To overcome FOMO, we have to first understand it. Coming from a purely psychological perspective, FOMO can be a habit, addiction or obsession, but it all stems from something deep within us; it speaks to our motivation and intrinsic desire to pursue the thing we want. In trading, much like relationships, it’s an unhealthy connection to something that fails to connect back. Oh boy, can that mess with someone’s head, especially when they don’t have the objectivity to see there’s a problem and the lack of willpower to pivot away.
This speaks to the grass being greener on the other side, doesn’t it? It’s an old adage because it’s true. People want to deny it but we often covet the things we don’t have, desire success that has yet to be earned, and our ego demands affirmation because that fuels our impulses. Don’t deny it.
Don’t deny the little green monster inside who isn’t tweaked when someone catches a lucky break or finds success where you may have tried and failed. Acknowledging that little beast will actually help you gain control over it.
If you’re on social media and really listening, you’ll see that most of the noise is made up of shillers who want to influence the market. The other ones are complaining about their losses. The ones who keep their nose to the grindstone, do their due diligence, and pay attention to the facts like market history, volume, and market capitalization, are too busy working on success to participate in the trollbox.
To this, I have to ask: Are you feeding FOMO?
Whether your answer is a resounding yes, or you’re even a little bit hesitant to answer because you see yourself here, there are ways to overcome FOMO.
Stop and Assess Your Influences
Where are you getting your market news?
If you’re getting your news from the trollbox, Discord, Reddit or any other social media outlet, then that’s your first problem.
Are they reliable or based on opinion and marketing propaganda?
Social media is full of marketing people and bounty hunters who are rewarded for spreading word about a project that you might want to invest in. Reliable sources might include the project’s website, whitepaper, GitHub, and AMA’s from the development team. Everything else is just noise.
Do you have a tendency to blazed your own way or follow market sentiment?
Remember what I said about motivation? As humans, we want to fit in. Blazing your own way is difficult and often not looked upon favorably. The market is not your friend. It doesn’t care who you are, what you do, or how much money you’ve got. Do not attach emotion to your trades.
How wide is the scope of your analyses?
If you find that you’re on a losing streak, it’s time to reassess your bot settings, tools, and widen the scope of your charts. If you find that you’re only watching the hourly or daily charts, zoom out to look at the weekly and monthly charts for market trends that you may have missed.
Have A Plan
Remember, the markets are volatile so you must have the agility to pivot with it. In order to build confidence and assert yourself as a stellar trader, you must have Plan A, Plan B, Plan C, and so on. I don’t want to get bogged down in the problem of over planning at this point in time, but at the very least, have a Plan B in place.
If trade volume falls below X then…
If the market turns then I will…
If my trade portfolio falls by X% then…
If the developers make an announcement then…
You are the final say in how you respond to market conditions and news. Seize the power and do something with it. The more objectivity you have toward what’s happening, the less FOMO you will feel.
Own Your Decisions
If you’ve done all the research, kept your emotions out of the decision-making process, and tracked your progress, there’s still a chance that you can lose out on a trade. For instance, you sold a token at one price point, but the market kept going up and you could have had a larger profit. Yeah that sucks, but with a plan in place you still made a profit, right? You did the responsible, smart thing. Own it.
According to CoinMarketCap, there are 4,798 cryptocurrencies on the market today. Just because there’s a plethora of tokens to choose from doesn’t mean you have to invest in them all. Realistically speaking, you don’t have Bill Gates or Elan Musk kind of money so being smart with your funds and your investments is a good idea.
It takes time to do the research and find the consistent gems that will build your portfolio. Keep your trades to a minimum and see how they go. A good strategy is having a few long hold tokens and a few that you can day trade or spot trade with. If you’re a HODLer, then the goal is to accumulate and sit on the token. In that case, put it in a cold storage wallet and take it off the exchange. It’s safer that way. But I digress, we were talking about FOMO and if you’re following the plan then the fear, anxiety and stress of trading should decrease.
On the flip side of that, if you’re too comfortable and sure, you’re probably way over confident. But we’ll save that topic for another day.
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