What is FOMO?
It’s Friday night, and you’re perfectly content staying in. But as you scroll through your social feeds, you suddenly find yourself feeling like everyone else is having more fun than you are.
That anxious feeling? That’s FOMO — a snappy acronym to describe a very specific facet of social anxiety: the fear of missing out.
And while the term “FOMO” may take you back to missed high school parties gone by, for avid traders, it’s taken on a whole new meaning.
In the crypto space, FOMO is a fear of missing out on something specific — a big-time crypto cash out. As unpleasant as FOMO may feel when it comes to social situations, apply it to your investments and it can be downright dangerous. FOMO can push investors to take ill-advised chances that end up resulting in financial ruination.
About Bitcoin and FOMO
When it comes to bitcoin, investor’s FOMO is driving trading aggressively forward. Certain reports show that the star cryptocurrency will have a massive breakout (though no one can say when, exactly). Even big-name corporations are feeling the Bitcoin FOMO — analysts suggest the likes of Starbucks and Microsoft are looking to invest in bitcoin.
There’s no quick fix to fighting FOMO investing, and no easy way to spot a worthwhile investment. But if you’re planning to invest in bitcoin or any other kind of crypto: do your homework.
Certainly, there’s a temptation to buy simply because it seems like everyone is talking about it, that’s rarely to never a good indicator. When it seems as if you’re hearing, seeing, and smelling a crypto everywhere you go, you’ll definitely feel the pressure to invest.
Instead, hold off. Do some learning: dig deeper into the latest bitcoin news and take a look over historical pricing. It might even help to run some basic analysis to determine whether prices are likely to keep climbing or crash. And note that because bitcoin is the dominant cryptocurrency, it affects prices of all other altcoins.
But just because you’re feeling FOMO doesn’t mean an investment isn’t worthwhile. In the end, it’s not FOMO itself that you want to avoid, but the impulsive, thoughtless actions that it can spark.
How to keep FOMO out of your trades
Maintain realistic expectations. No one can be successful 100 percent of the time. Even the best athletes lose a game. Once you accept that you can’t win them all, you can live free from investor’s FOMO.
Get JOMO on your side. The opposite of FOMO is JOMO — the joy of missing out. You know how, sometimes, nothing feels better than not going to a party? Channel that JOMO into investing — revel in the time not spent trading, and you’ll be better for it.
Make a plan and stick to it. The very best way not to let investor’s FOMO ruin your trades is by creating trading rules and guidelines ahead of time. Plan out your entry points and exit points and do not let any price jumps or drops change your mind.
Better yet, automate your trades. This will keep your emotions from taking over and interfering with your trades, and keep your emotions from taking over. By letting a computer take the reigns, you can be sure to stick to your game plan, avoiding human error and impulsive FOMO-driven mis-trades.
Think about it: if you set up your trades ahead of time, you won’t even have a chance to succumb to those creeping feelings of investor’s FOMO.
Plus, you’ll never miss out on an opportunity or a trade you meant to make. By automating your trades, you can monitor signals on a wide range of market metrics, 24 hours a day.
Tools like Capitalise allow you to automate your trades from start to finish, from plan through execution. All you have to do is enter your order using natural language and the Capitalise Platform will take care of the rest.
So, instead of blowing a couple G’s during one weak, panic-driven moment, you can rest assured that an automated trading system will keep a clear mind.
It’s almost too easy. Almost.
But then again, who said making it easy to trade was a bad thing?