Crypto Academy Season-3 | Intermediate course by @allbert –week 05: Psychology and Market Cycle.

FOMO

As we know the word that we often use the one word FOMO which is not only use in the cryptocurrency but it is also using in the other so many things , but what is the understanding the FOMO in the crypto?

The word FOMO mostly use for those people who are the addicted of social media . As we know that it stands for the Fear of Missing Out . Many of people want to follow the new trends and don't want to miss that even the many of people don't kow that where are they going on .

As it is the in the cryptocurrency's world , many of traders begin to buy the different cryptocurrencies when the prices is on the rise due to influence of the media , they do not want to be left behind even they don't know about it . Then they compell to themselves to buy the more currencies because they don't want to miss this trend , because they always follow the current trends and want to become the rich in the next moment or in the one night .

FOMO is a effect or chance when the newly traders and investor are afraid from this phenomenon and being left behind and don' t get the profit from the cryptocurrencies even that time the prices rise up , so that they compell to themeselves to buy the BTC and other currencies at very high prices , then they called FOMO.

FOMO cycle occurs

It doesn't stay there, the all whales are rapidly selling their all assets and want to make profit in compliance cycle . But the FOMO confident still now that the prices will recover and continue to rise up . And a downturn happens when people panic and start selling their assets on a large scale . Then they bear the all losses and themselves and crying in their rooms after closing the door .

Why FOMO happens

FOMO happens due to the trading Psychology , especially Recency Bias. FOMO occurs due to :

Greed: want to get rich in one night .
Fear: Doesn't take the profit .
Envy: Who make a lot of profits .

What is FUD , where does cycle occurs and why ?

FUD is an abbreviation of Fear , Unceratainty and Doubt at which is a trader Emotional Bias in the trading . The term used for the negative realization because of several things to opposite a crptocurrency . FUD is a Psychological trick to role a trader's negative in order to impact the market .

New investor and traders do not control to themselves and they cheated from the negative news about the cyptocurrencies and become aim to sell their all assets . They estimate that the crypto asset's prices will go down corresponding and face the difficulties to recover the assets because the some irresponsible people spread the negative news who want to profit with their FUD tricks .

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FUD cycle occurs

People try to observe the market's emotions and then get the results that now the market is recovered and now will rise up again , it may occur in a cycle of worry and denial . Then some negative new make the market Psychology and panic . They are afraid to lose their assets more because someone is already try to selling it .

Why FUD happens

Sometimes market Psychology impacts a person's trading Psychology because of the deficiency of the knowledge and informations which we know . It could be due to we are starting out in cryptocurrency .

Explain in which emotional phase of the cycle it is and why. Must be different phases

Now here we have a SAND Tokens , which is in a bearish phase . The Token is decline because it has just gone through a pleasant period . After the analyzing since last some days a sizable token release by whale investors to take profits .

Now complacency cycle has been passed and is in the worry . But it won't last long . From here we can see the psyche of market. Peole do not control their emotions and they want to take money return back and want to continue their tokens even they have to face the losses . The psychology of market chaos also affects the psychology of trading .
Now traders are starting to think about giving up all their holdings for fear of incurring further losses.

IOTA/USDT

When i took a screenshot of IOTA/USDT Token . It was still in the throes of thrill . Now you can check that the IOTA/USDT token has started to be valid .

IOTA market has now crossed the peak of excitement and investor will step back to get advantage of their investment . We must be careful not to become FOMO. At least , we should wait one or two days . The IOTA market needs to re-analyzed before any investment can be made . We should patient and don't rush . Now we can buy IOTA Tokens but not to become it FUD because it will harm to us .

Based on the analysis done in question 3, and the principles learned in class, make the purchase of 1 cryptocurrency in the correct market cycle. The minimum amount of 5USD (mandatory), add screenshots of the operation and the validated account.

Conclusion