stands for “fear of missing out”: the fear of missing a rise. This fear pushes you to get in late and without a plan, often near a high. works afterwards: once you have bought, you mainly look for news that proves you right and overlook warning signs. Neither can be switched off, but firm rules can slow both down.
How to recognize FOMO
The price has already risen a lot, everyone is talking about it, and you want to get in “quickly”. An entry without a stop and without any reason other than the rise itself is a warning sign. There is always a next trade – a missed rise costs no money.
Look for counterarguments
Before buying, write down what speaks against the trade and at what price your idea would be wrong. Deliberately read opinions that disagree with you. If you only look for confirmation, you almost always find it.
Hindsight is easy
In hindsight every rise looks obvious. This hindsight bias leads to “I should have known” and to hectic purchases. Judge decisions by whether they followed your plan, not only by the result.