What Is FOMO?
Firstly if you've never heard of this it stands for the fear of missing out, but it should really be restated the ruminating and worry of missing out.
This trigger can be strengthened when you miss the trade and it becomes a winner which then creates a term I call ROMO which stands for Regret of missing out.
What is happening in both these situations is when you have an ‘automatic thought’’
Like ‘’What if this trade wins? I don’t want to miss this trade, I've already lost one. I will be so annoyed if I miss another winner.’’
What tends to happen is we attach to these thoughts and succumb to them but this often leads to regret as you get in late or lose a trade that was not part of the plan.
What Exactly Is Happening When Experiencing FOMO?
You had a thought and you started thinking and ruminating over all of the possible negative and positive outcomes of what would happen if you missed it
And then when a trade does lose that you jumped into for no rhyme or reason, that's again when you start to trigger the ruminating process (your default thinking process) and start going over and over it in your mind trying to find answers.
Which ultimately keeps you stuck.
And this all shatters your confidence and keeps you fixated on that rumination and worry process until the next time.
You simply need to work on creating a better 'thinking' process and how you deal with these thoughts, feelings, and emotions.
The Key To Overcoming FOMO
What it comes down to stop the sabotaging pattern is to first become aware of when you are in that ‘thinking mode’’
And train yourself to not talk back to your thoughts.
Just like an annoying reporter, they will try to get you to engage by asking you lots of questions
You have the freedom to say ‘’No comment’’
Your mind works in the same way, it will start to persistently ask you...
‘'What if? and why?'' questions trying to get you to engage in conversation with it.
But when you do you are then only strengthening its power and making the thoughts more relevant.
When you don’t engage with it then its power eventually weakens and over time of doing this, it will begin to realize that it won't have as much of an effect on you anymore and give up.
Become An Observer To The Inner Events
Learn to first become aware when it’s happening and just observe the thoughts and understand for what they are, just thoughts...
You will probably notice that a new thought will probably appear…
A good analogy is to just think of your thoughts like clouds in the sky and see them as just passing events in the mind.
And with time you will realise you are not your thoughts, you are, just someone who has thoughts.
Not every single one needs your attention.
Practical Techniques.
Some techniques to practice are detached mindfulness, thought postponement and attention-training exercises
This is something I work on with my clients but I can’t explain these as this post will start turning into a book. Lol!
But here are 5 other great things you can also start doing right now.
Have A Plan:
First, make sure you have a clear trading plan so you know when you are succumbing to FOMO.
It amazes me how many traders don’t have a plan yet they say they are suffering from FOMO.
Review Past Trades:
Reflecting on past trades where FOMO led to poor outcomes can serve as a good reminder of why you don’t want to do it.
Especially when you see the negative effects of what happens.
But along with that, you will also be able to start finding patterns that lead to FOMO.
Thought Journal:
A great way to start creating awareness is to start journaling these ‘automatic thoughts’ and the triggers that led to them.
This way when they do happen again you will have more awareness in the moment and more likely be able to prevent it before it happens.
Meditation
Meditation is a great way to start becoming an observer of your mind and learn to stay present.
Start with a few minutes a day to build up the habit and increase as you get more comfortable
Visualization
This is a great tool to use to prepare yourself for situations that could lead to FOMO.
You can start to imagine the different scenarios and imagine how you would deal with them in a calm and confident state.
Then when they do happen in real time you will be far more prepared as you’ve already done it!
And that’s a wrap!
FOMO can be a deadly trap for most traders, but once you start taking action to deal and prepare with it then that is when you will start really moving forward!
Thanks for reading, and remember:
You're not alone in this journey toward trading discipline if you feel you need more help I do offer 1-1 coaching,
So please reach out if you would like to work with me!
Have a great day!
Alan
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