FOMO, the fear of missing out, and FUD, the trio of fear, uncertainty and doubt, are the two emotions that ruin the most retail traders, often following a single tweet. In May 2021, dogecoin surged 41% in 24 hours toward a record of $0.89, driven by euphoria around Elon Musk’s appearance on Saturday Night Live, before dropping nearly 30% during the show when he jokingly called his favorite cryptocurrency a hustle. Four days later, Tesla suspended bitcoin payments for environmental reasons, evaporating approximately $365 billion from the crypto market. To protect against these emotional biases, experts recommend establishing a written trading plan in advance, using mechanical strategies like DCA, and limiting social media exposure on record-breaking days.
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