ᐅ FOMO in Cryptocurrencies: What It Is ⚡ and How to Avoid Fear of Missing Out

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FOMO - What Is It in Cryptocurrencies and How to Avoid It?

FOMO - What Is It in Cryptocurrencies and How to Avoid It?

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Social media communication creates new abbreviations and acronyms. FOMO is one such concept.

Fear of missing out (FOMO) translates from English as "fear of missed opportunity."

What does this mean in trading and how can you avoid this phenomenon?

What is FOMO based on?

The concept of missed opportunities has existed throughout human history, but FOMO has significant differences. Modern traders constantly monitor trading terminals on their personal computers while simultaneously receiving trading signals and important information from their smartphones.

Media personalities, daily trends, and rapidly changing information environments affect a trader's mindset. They fear falling behind current trends, which leads to impulsive actions. For example, a Twitter post announces a new token dedicated to cute corgi dogs. An emotional trader transfers part of their balance to the advertised token, only to lose a portion of their savings the next day. When opening the position, they feared being left out and missing the extraordinary profits from the newest token. However, the trade resulted in a serious loss. This is precisely how FOMO operates.

How to avoid becoming a victim of FOMO?

Only self-discipline can protect a trader from impulsive purchases after seeing a tweet about the listing of another "popular coin." Experts recommend studying classical works by traders from the past century who describe long and exhausting trading sessions in the trading pit. These traders provide advice on financial discipline in their books. They assert that a trade should be contemplated for hours or even days. Sometimes, it's better to postpone a trade if there's uncertainty about its outcome.

It's essential to create your own trading plan and follow it without being distracted by momentary trends from social media. Young people under 30 are more commonly affected by this syndrome. However, significant financial losses can teach valuable lessons, though it's better to learn from others' mistakes and develop stress resilience and trading self-discipline.