Tell me if this has ever happened to you…
You see other traders posting online about their glorious gains and feel insignificant.
Then, you start thinking to yourself…
If only you had made that trade, you would also have those gains. Is it too late to get in?!
Friday’s shocking post-jobs report market surge — when the SPDR S&P 500 ETF Trust (NYSEARCA: SPY) jumped 1.4% — had a lot of traders feeling the fear of missing out (FOMO).
Make no mistake — FOMO is a recipe for disaster.
If you wanna have a lasting career as a professional trader, you must remove FOMO from your mindset entirely.
On the other hand … If you fall victim to FOMO, you’ll find yourself entering trades too late, under-researched, and without a clear exit plan.
Then, you’ll probably be left holding the bag while social media pumpers count your money.
I want every Evolver to avoid such a fate.
Keep reading and I’ll show three simple ways to defeat FOMO once and for all…
Don’t Chase Other Trader’s Plays
The first step to avoiding FOMO is to tell yourself you’ll never chase trades that are outside of your personal trading strategy.
If you make this promise to yourself and stick to it, you’ll have nothing to worry about when it comes to FOMO.
The problem with chasing is twofold.
First, you never know if the trader (or position) you’re chasing is actually right or not.
Second, you can’t guarantee that said trade will fit your personality, strategy, and risk tolerance.
But this is difficult for many less-experienced traders to execute in action.
They see a stock ripping and their emotions take over, causing them to buy way too high into the pattern cycle.
Then, they’re inevitably left holding the bag days (or even hours) later.
Please, don’t be like these traders.
Other times, you’ll see the play working after your setup happened and it’ll sting that you’re not in it.
I get it — I’ve been there many times before.
But if you recognize that it’s probably too late to enter, just accept it and move on.
I promise you … If thousands of traders on social media are pumping a stock that’s deep in the green, you shouldn’t go long on it.
That’s textbook chasing caused by FOMO. Avoid chasing and, in turn, avoid FOMO.
Take a Break from Social Media
It’s no secret that, in the 21st century, most of our information comes from the internet.
Similarly, I find that online trading message boards are a major source of FOMO for traders.
After all, social media is where you see other traders posting their ideas.
I’m not saying there aren’t any smart traders on social media nor am I suggesting you can’t get valuable information from message boards.
However, for every stellar social media trade — like the infamous 2021 GameStop Corp. (NYSE: GME) short squeeze — there are thousands upon thousands of failed setups, incorrect due diligence posts, and even worse, scammers trying to pump you a worthless stock.
The problem is the sheer amount of posts on ‘FinTwit’ — how can you reliably separate the ‘signal’ (worthwhile data) from the ‘noise’ (meaningless chatter)?
In the age of Twitter, Reddit, and StockTwits … herd mentality (which leads to FOMO) can be a serious obstacle for traders.
So, if you find yourself tempted by FOMO … turn off your social media for a few days.
Doing so will help center you within your own thoughts and ideas. Stick to your strategy.
Don’t worry about what other traders are doing. Even if their game plan is working for them, there’s no guarantee it’ll work for you.
Trade Like You’re Retired
If you subscribe to my alerts, you’ve probably noticed that I don’t trade every day.
That’s a conscious decision. Some days, I don’t find any setups that fit my strategy.
I like Tim Sykes’ philosophy of “trading like he’s retired.” I think that’s a good way to look at it.
If I let FOMO get the best of me, I’d probably make a bunch of trades that don’t work within my game plan.
In fact, when I was first starting as a trader, I did exactly that…
But my years of experience have taught me to stay patient and disciplined.
I’d rather miss a potential win than take a big loss.
REMEMBER: Trading opportunities are like trains … there’s always another one coming.
Whenever you’re considering getting into a trade, ask yourself if it fits your overall game plan.
To accomplish this myself, I use my buddy Tim Bohen’s ‘3-Item Checklist’:
- If a setup doesn’t show elevated volume — pass.
- If a setup doesn’t display the technical indicators we look for in a chart — pass.
- If a setup doesn’t have a major catalyst — pass.
However, if I find a setup that checks all of these boxes — I seriously consider putting the trade on.
But why should you care?
Because sticking to these rules has helped me make more than $4 million in the markets.
So, take it from me. Don’t enter trades you have no business being in. Avoid FOMO at all costs.
Now, before we go, I have one very important question for you:
Are You Ready To Take The Next Step?
Here’s the truth … I wouldn’t be a multi-millionaire if I hadn’t joined Tim Sykes’ Trading Challenge so many years ago.
And I want you armed with all of the tools necessary for success in the stock market.
So, if you’re passionate and dedicated, ready to take on anything the market throws at you, then I’ve got something for you…
My mentor, Tim Sykes, has helped traders learn to succeed for years. More than 30 of them (including me) are now millionaires.
Are you ready to take your trading game to the next level? Do you have what it takes to face the Trading Challenge?
Let’s find out…
I’m excited to see you there!