There are two main enemies of traders in financial markets: the fear of losing and the fear of missing out. The second enemy, FOMO (Fear Of Missing Out), is the most dangerous because it masquerades as a “rational opportunity” and forces you to act when you should wait.
FOMO is an emotional impulse to enter the market without a system, simply because it seems that “everyone else is making money, but I’m not.” And this is not a weakness of an individual. It is a mechanism of the brain that has helped us survive throughout evolution, but now works against us in a risky environment.
Where Does FOMO Come From?
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Evolution
The human brain is programmed to join the majority: in the past, this saved us from danger. If you missed out on prey, you feared going hungry. Today, if projected onto financial markets, missing out on an asset movement creates a feeling of “failure.”
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Dopamine system
The expectation of reward activates the reward centers. It’s hard to escape because hormones literally push you to act.
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The illusion of control
When the movement has already started, it seems that: “It’s obvious! Why am I not in it yet?”
But obviousness is always after the fact.
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Social comparison
The brain evaluates success not in absolute terms, but relative to others. Someone writes that they have earned money, and you think you are lagging behind. And that triggers panic.
What Is FOMO from a Psychological Perspective?
Psychologists view FOMO not as a whim of modern culture, but as a powerful emotional and social mechanism that influences thinking, self-esteem, and behavior. FOMO is the anxiety that others are getting something better than you, and it’s happening without you. It’s a combination of:
- social anxiety;
- comparing yourself to others;
- fear of making the wrong choice;
- feeling a lack of control.
FOMO is considered a form of cognitive distortion: focusing only on what we don’t have and ignoring what we do have. FOMO has become a widespread phenomenon precisely because of the constant observation of other people’s lives. This has been made possible by the rapid development of social networks.
The Role of Social Media in FOMO Trading
As unfortunate as it may sound, social media amplifies FOMO triggers many times over.
| Social media mechanics | Effect |
| Selection of the best moments (only profits) | The illusion arises that everyone is earning money |
| Fast content (TikTok, Reels) | Decisions are made emotionally, without analysis |
| Mass approval (likes, comments) | Social pressure: “everyone do this, so I have to do it too, I can’t be left behind” |
| Influencers without experience | Popularity is perceived as expertise |
And the more you watch this kind of content, the more your brain goes into “I need to act now” mode.
How FOMO Affects Mental Health According to Psychologists
Psychologists note that:
- FOMO reduces the quality of thinking;
- increases impulsive actions;
- causes catastrophizing of the future;
- causes dependence on instant results.
All this leads to a high probability of errors.
Typical FOMO Behavior Scenarios In Trading
- Entering at the peak. The price has already moved, the trader jumps on the last train, gets a reversal.
- Overtrading. “It’s definitely going to go up here!” – an emotional series of trades without signals.
- Excessive risk. Increasing the lot size because “you can’t miss this chance.”
- Attachment to the past “I already missed it once, I can’t miss it again!” – attempts to recoup losses.
The First Signs That You Are Being Controlled By FOMO
- Wanting to enter right now. No analysis, just impulse
- Thoughts of someone else’s profit. Decision based on envy
- Fear that the “asset will escape”. Rationality is disabled
- You cannot formulate a clear trading plan. This is not a strategy.
If you can’t answer where you’ll enter, exit, and why…it’s FOMO mode.
How to Train Your Mind Against FOMO
It’s not a question of willpower, but of the right skills and environment.
- Planning ahead of the market. Written rules for entry and exit. The brain doesn’t have to make decisions on the fly.
- Limit information noise. Fewer trading TikTok clips = fewer FOMO triggers
- Statistics instead of emotions. Belief in the system grows from verified data on the backtester, not from “I feel like…”.
- Developing patience. Successful traders: 95% of the time do nothing, 5% – act decisively.
- Focus on the process, not the results of others. You need to compare yourself with yourself yesterday, not with influencers.
Algorithm of Actions if You Are Already Experiencing FOMO
Brief protocol for a “stop reaction”:
- Physically stop the action: hands off the keyboard.
- Take a deep breath. Then ask yourself:
- What is the level of risk?
- Is there a clear plan?
- Am I following the system?
- Record the thoughts in a journal.
What exactly triggered the desire to enter the trade? It is best to write it down by hand on a piece of paper rather than typing it on the keyboard.
- Shift your attention.
Stand up, walk around, do some light exercise (squats or push-ups), ideally go outside and take a break for at least 10 minutes. You need to change your focus. The market isn’t going anywhere. It will still be there tomorrow and next week, which is more than can be said for your deposit.
- Return with sober logic.
If the deal fits perfectly into the system, then go ahead. But if not, then skip this deal with discipline.
Bottom Line
FOMO is an emotional mechanism that arises from our desire to keep up with others and our fear of making the wrong choice, but in reality, it is rarely related to real opportunities. It is anxiety, amplified by social media and constant comparison with others’ successes, which prevents us from thinking clearly and making decisions that are in line with our own goals.
To curb FOMO, it is important to strengthen your inner confidence, reduce the influence of external information noise, and learn to make choices based on real facts, not on the fear of falling behind.