Why are we afraid to buy while the price is going up… and buy only after it has already taken off?
The scenario that usually happens with most traders:
The price starts going up...
You say: no, of course it will come back.
The rally continues...
You say: okay, it’s getting too expensive now.
It goes even higher...
And suddenly you start fearing that the opportunity will pass you, so you enter a buy order at a higher price than the one you previously refused to buy at!
That’s FOMO, or fear of missing out....
The problem is that at that moment you might be right about the direction, but wrong on timing...
The price has already moved; the logical stop-loss is now further away, and the Risk/Reward has become worse, and any normal correction could pull you out of the trade...
The problem isn’t that you didn’t know the direction...
The problem is that you waited until the market convinced you—after the opportunity had already become worse...
That’s why sometimes we fear buying at a lower price...
and reassure ourselves to buy after the price has already flown...
#AIStocksWhatNext
The scenario that usually happens with most traders:
The price starts going up...
You say: no, of course it will come back.
The rally continues...
You say: okay, it’s getting too expensive now.
It goes even higher...
And suddenly you start fearing that the opportunity will pass you, so you enter a buy order at a higher price than the one you previously refused to buy at!
That’s FOMO, or fear of missing out....
The problem is that at that moment you might be right about the direction, but wrong on timing...
The price has already moved; the logical stop-loss is now further away, and the Risk/Reward has become worse, and any normal correction could pull you out of the trade...
The problem isn’t that you didn’t know the direction...
The problem is that you waited until the market convinced you—after the opportunity had already become worse...
That’s why sometimes we fear buying at a lower price...
and reassure ourselves to buy after the price has already flown...
#AIStocksWhatNext
