What is FOMO? FOMO is an abbreviation for Fear of missing out. This feeling is experienced by many traders during their journey in Forex. You may meet many of them who may make illogical decisions that are far from their strategies just because they do not want to miss the opportunity to become millionaires.
The Psychological Triggers Behind FOMO
1 – Fear
Fear is a very important factor in FOMO and it is one of the most important reasons for making completely illogical decisions. Let us agree that fear is a feeling related to the future because you do not know what will happen in the future, so your mind prepares several scenarios that could happen and reacts based on these scenarios, knowing that these scenarios have no basis in truth or any other factors that determine whether they are logical or not. Your mind does not distinguish between logical and illogical. It only assumes what will happen and does not care whether these possibilities are far from reality or not.
For example, you are an employee in a company and your wife calls you while you are working and starts talking to you but the call was cut off and the phone suddenly hung up. What is the reason? You tried to call her several times but to no avail. Here comes the fear factor and your mind has prepared several scenarios and answers to the question of why your wife suddenly hung up, including that she had a car accident while crossing the road or that she fell down the stairs, or that she remembered something that made her angry at you. when she called.
Fear
There are many scenarios that your mind might conjure up to convince you that something wrong will happen in the future and that the reason is not good, but there are logical scenarios that might be true and have believable reasons. For example, it is possible that her phone battery ran out, right? Or that his daughter called him from her mother’s phone while she was playing with the phone.
Fear makes us prepare for the worst possible scenario that could happen. In fact, this is both a good and a bad thing because it can make us imagine things that are very difficult to happen, and at the same time, it acts as an alarm to tell us to be prepared for what might happen.
In trading, when you analyze a pair and want to enter the trade after determining the entry area, take profit and stop loss, and you look at the news carefully, at this point the fear voice is not strong enough because you have not entered the trade yet, but fear works to prevent you from entering the trade so that you do not lose your money, and if you want to know the reason, in fact you will not know what is the reason for this feeling.
Because logically if you want not to enter the trade because you will lose money then why do you trade in Forex right? Well, you overcame this feeling and entered the trade here the fear factor becomes stronger than before because you are already in the market and it is possible that you will lose your money but it is possible that the trade will go as you want and in this case your balance will increase.
2 – Social media
There are many stimuli that may make you feel FOMO, including social media, through which you can follow many traders who publish their analyses and unlimited opportunities 24 hours a day. This may make you feel that you must seize these opportunities before it is too late. Following this amount of analyses and Signals makes you very distracted, and the result is that FOMO controls you and you find yourself losing all your money.
I am not saying Social media is bad, social media is good if you use it properly and determine the traders you want to follow. Not any analyst can be followed, you must determine whether this analyst has good experience in trading and is aware of what is happening in the market or not, and does he place a stop loss or is he a gambler?
The goal of analysts on social media is to get the largest number of followers who can profit from their deposits under their IB or subscription to their channel on Telegram or tempt them to deposit money in investment portfolios… etc. There are many reasons that make you wonder why there are this large number of analysts on social media!
In fact, the presence of this number of analysts who tempt traders to profit from them, there are also very few analysts who have one noble goal in common, which is to focus on teaching others through the analyses they provide. These analyses and Signals may be completely free, as they want to make you earn money without expecting anything in return from you.
3 – Greed
GREED
How can FOMO control you by exploiting your greed? We all have a desire to get money and no one wants to lose or get a small amount of money when there is an abundance of that money, right? Therefore, the greed inside you can control you while entering a trade, as you can enter a trade that is not well thought out and with the slightest possible signal, thinking that this trade will win.
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Greed is a bad trait that can lead its owner to many losses in Forex, but what led to the presence of greed in Forex in the first place? ask yourself, did you enter Forex thinking that this market has a lot of money and that you can get what you want and leave? If you think that Forex is a sea of money, then you have left a door for greed to enter you through it, and consequently, when greed controls you, FOMO will also control you.
4 – Daydreams
As we said before, fear and greed are factors of FOMO and lead to huge losses. When you fall into these traps, you will make illogical decisions in the hope that you will win your trade. You may move the stop loss or take profit immediately after opening the trade because you are afraid of losing your money. Of course, no one wants to lose their money, but this decision that you made after opening the trade is certainly a decision stemming from FOMO.
You will notice this yourself, as your psychology, feelings, and decisions before opening the trade will be completely different after opening the trade, so try to make any decision related to the trade before opening it, and when opening the trade, close the chart completely so that FOMO does not control you while you see your account in profit or loss.
Recognizing the Signs of FOMO in Your Trading
FOMO Alert
There are signs that can help you recognize FOMO so that it does not control you. For example, before opening a trade, ask yourself: Is the market suitable for entering any trade? If the answer is yes, then you will analyze the market as usual, but if the answer is No and you still want to open a trade, then you are most likely now about to be controlled by FOMO.
Because it is logical that in this case, you will not enter any trade because the market is not suitable technically or economically. The market has many opportunities that occur every day, but the urgent desire to get money and the fear of missing this opportunity that will never come again (FOMO) may make you enter a trade.
There is also a sign that may help you identify FOMO but before we delve into this sign let me ask you a question, do you trust your analysis method? If the answer is no then you should continue learning and gaining experience before trading on a real account and if the answer is yes then you will find yourself doubting your analysis method little by little and you will try to find another method with more chances of entering a trade, Knowing that your method of analysis has been tested for a good period of time.
How to control FOMO?
In order not to let FOMO control you, we must first point out some of the concepts that may have reached you by mistake or that some traders have tried to plant in you these concepts in order to profit from you.
First of all, you must be very aware that Forex is not a treasure from which you can take whatever you want. Indeed, Forex has a lot of money and you can become rich, but not in the way you think. After spending several months and years in this field, you will discover day after day that Forex is an investment field and a field that you must work hard to understand and take your time to achieve this, so that you do not fall into losses.
Why should you take enough time to learn? Forex has many opportunities that occur every day, and I am not exaggerating when I say this. There are countless opportunities in Forex, and you can seize these opportunities at any time you want, but these opportunities are not available to every trader. The market is profited from by all traders with different types of analysis.
For example, a trader who uses technical analysis may see an opportunity to enter a trade one day and another day the conditions for entering a trade will not be available, but these conditions will be available for a trader who uses SMC, you have to be patient until the opportunity comes that suits your trading style and be sure that this opportunity will come, if not today, then tomorrow or even next week, so be patient so that you are not exposed to FOMO.
The Role of Patience in Successful Trading
Patience in Successful Trading
Patience is the best cure for FOMO. Imagine for a moment that there is an opportunity to enter a trade, but this opportunity is incomplete. You did not rush to enter the trade, but you waited until the appropriate signals were complete to enter the trade. You actually entered the trade and won. How do you feel?
There is no doubt that you will feel very comfortable and will be completely satisfied with your decision not to enter the trade early, whatever the result in the case of early entry. You should not be distracted by what would have happened if you entered the trade earlier.
Because that decision is certainly the right decision, and if the decision to enter the trade early is profitable or losing, this does not concern us at all because you made the right decision based on the strategy you follow.
Reacting in impulsive moves
There are many reasons why the market may move a very large number of pips in a short time, such as news in the economic calendar or natural disasters…etc But how do we deal with these violent movements?
First, if you are aware of what is happening in the market and what is the reason for these rapid movements, then it is okay to make the appropriate decision for you, whether you want to enter the trade or not. But if you do not know what are the factors affecting this rapid movement in the market, then it is better to find out what are the reasons. If you fail to do so or the reasons are not well understood, then it is better not to trade at such times.
But FOMO has another opinion, it will try to make you enter this fast movement in order to get profits in a short time and not miss this wonderful opportunity. Let’s say that you did not enter at this fast movement. If you wanted to buy EURUSD for example and it actually went up, Will you blame yourself for not entering this trade? You should not be sad about making any reasonable decision because the exact opposite could happen and you would lose this trade if you entered it Right?
Conclusion
FOMO is an enemy of any trader, whether a professional trader or a beginner. In order to get rid of this enemy, you must first be fully aware that it exists and that there are many tricks it uses to make you fall into losses, such as the fear of missing the opportunity to enter a trade without making sure of the appropriate factors to enter this trade or entering at the time of news, etc. The market is full of opportunities, so be patient until you find the right opportunity for your strategy.
