THE PSYCHOLOGICAL CONNECTION WITH TRADING IS INDISPENSABLE
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After the pandemic, people found themselves needing a new way to help them in the face of the crisis that unemployment caused after the pandemic.
One of the biggest fears among users and large investors who allocate their funds to cryptographic investments is the risk of losing everything. This phenomenon is known as FOMO.
Emotions and psychology are fundamental to making investments since it is standard for human beings to generate emotions and feelings when it comes to money; they are on the surface, which is why it is necessary to control them and know how to manage them.
Fear when investing
Digital currencies have taken over digital financial investments, which is why today it represents an essential topic for analysis and evaluation since many are new market members.
When investing, people begin to generate a series of emotions, even when they think about investing with cryptocurrencies, since they have two elements that, in most cases, cause great uncertainty and fear, such as volatility and risks.
Financial markets suggest keeping a cool head when investing, as greed, desperation, and fear can play tricks on investors.
Many experts say that money in financial markets tends to go from the impatient to the patient; by this, they mean that the money wasted or lost by people who cannot control their emotions tends to go to people’s accounts who maintain self-control.
One of the critical aspects when investing is the coldness and firmness with which investment decisions are made; in the control of emotions where the main success factor resides, intelligent investments usually leave higher profits than impulses.
If people used intelligence to make investments, they would realize how productive this quality that all human beings have is, only that the lack of emotional control is what affects and generates this dynamic phenomenon.
FOMO is a phenomenon that can be generated daily, but it is one of the factors that have the most significant effect on investors when making their investments.
Although psychology does not seem to be related, it is the fundamental basis during the investment processes since being able to remain calm when carrying out a financial operation without experiencing the fear of being left out of profits.
That is why investors usually carry out previous analyzes of digital assets before deciding to enter a certain period; the purpose is not to take risks of losses.
This phenomenon usually has adverse effects on investors when trading since most of them make impulsive decisions without letting the market show its movements.
The psychology of investments
Psycho trading involves methods that allow cryptographic investments to develop systems and organize without letting emotions and feelings invade investors and make inappropriate decisions.
Technical and fundamental analysis are part of this psychological strategy that allows us to suppress anxiety since knowing and evaluating the various scenarios that make the market move will enable us to operate safely and firmly.
Traders must prepare just as any athlete or professional would since investments require academic preparation even more, so those made with cryptocurrencies, since factors other than human beings, such as volatility, must be managed.
No matter what type of trader you are, from novice to professional, you need to control euphoria, greed, and fear; these elements are called enemies of investments.
The experience and constant practice will allow traders to carry out operations with security and certainty, regardless of the scenario in which they are operating.
Making mistakes in this economic environment should not be considered losses but rather a strength that will make future transactions safer and more reliable.
Although for many people, the main thing is to have capital that allows juicy investments to be made, it is false; the main thing is the preparation of the trader; it is there where you learn to manage the various emotions and the operations that are executed tend to be more fruitful.
Overnight wealth is not created with cryptocurrencies but with financial education and preparation.