Here’s no hitting the snooze. No taking a break, pressing the pause button. It’s all in a moment’s time. The blinking prices on the multiple screens that all demand your attention; the charts and the news and the trendlines; the resistances, the supports, the potential as well as the open trades; the sentiment, the assets, all the opportunities and finally… the decision: is this the right moment to open or close that trade?
And before you know it… The moment’s gone. And you beat yourself up for not making the decision earlier. And you are tempted to start another adrenaline-filled cycle to make up for what you’ve failed to do earlier. STOP! Take a deep breath and before you do anything rash read this article. Everything will be much better, we promise.
Every trader, beginner or even expert, suffers from some kind of FOMO, the Fear, that is, Of Missing Out on trading opportunities. Yes! Every single trader out there “suffers” from a level of FOMO. What changes, however, is how each trader handles that to make him better at trading.
The should’ve, could’ve, would’ve mentality
It’s easy to dwell in the past. We all do it. We all fall into the wondrous rabbit hole of what could’ve been. Unless you have a time machine, the past won’t ever change, no matter how hard you dwell, or beat yourself up. So, our advice? Take that energy and invest it in the future!
Learn from your mistakes. Ask yourself the hard questions: why didn’t you make the call? Should there have been anything that you could’ve known and would’ve made the decision easier (see what we did there)? Find the answers and implement that knowledge in your future trading decisions. And if you don’t have these answers then you definitely need to pay attention to our next point:
The missing trade or the missing strategy?
Are you blaming yourself for not taking that opportunity on time? Well, as the Mad Hatter would tell you… “No wonder you’re late, this watch is exactly two days slow!” In other words, if you don’t have a trading strategy you’re always going to be late at the party!
You see, most of your undecided trades or the rushed opportunities feed your FOMO that leads to mistakes because of one thing: lack of strategy and planning that guides your trading activity.
In other words, you need to have a clear understanding of what you seek to achieve and what steps you are going to take to get there. This will keep you in place, by trading in a disciplined and responsible manner – avoiding the risk of impulsive and emotional actions all-the-while giving you the important information to step back. It really is easier than it sounds.
A trading strategy consists of three different elements: The plan, the rules checklist and a trading journal. Each of these elements complements each other in order to provide you with a clear picture of the actions you need to take or avoid.
➡️ The Plan: Your plan is the beginning of your trading thought. It is the combination of your instruments, an analysis of the instruments, your goals and scenarios along with a set specific actions. This will keep you in check with everything that you set out to achieve and will make any “maneuvers” out of the plan, much more conscious.
➡️ The Rules Checklist: This is what makes your plan actionable! The checklist is really the evolution of your plan, providing you with specific rules on when and how to trade your chosen assets. With a set of rules you strip your trading actions from any emotions. You base all your trading executions on the checklist which is based on your already set plan.
➡️ The Journal: No, we don’t want you to be a writer, if you don’t want to be. But journaling is a common practice not for traders as it gives people the ability to reflect on their actions and decisions. Your trading journal can also help you record your activity and go back to it anytime you need in order to recreate previous successes and avoid past mistakes.
All in all, your trading strategy will help keep you in line with everything that you are planning for the future. It will act as a constant reminder of what you set out to achieve by keeping you in line with your goals, your emotions and give you the entry and exit points for your trades.
The next opportunity is just around the corner
At the end of the day, it all depends on how you look at it. It’s a matter of psychology. You can either enter a vicious circle where you continue falling and falling or you can put your negative feelings aside, silence your doubts and let your logic prevail. The markets, after all, never stop. The next opportunity is just around the corner. And the other corner, and across the street and EVERYWHERE!