If you decide to become a cryptocurrency trader you notice words used by the crypto community in trading is not used in regular tradings just like here HOLD called as HODL and this is still one example for crazy crypto terms still there are many terms are in use.

Here I am going to explain you about 2 words FOMO and FUD if you wondering why these 2 words? only because there are so many words used in cryptocurrency trading but these two words are confusing every time.

So let’s understand what is FUD?

FUD

FUD stands for Fear, Uncertainty, Doubt, in cryptomarket or market in general and it represents psychology of real life, as a matter of fact, do not forget that when you’re in the market you’re basically playing with fear and greed, this is the psychology behind any market.

FUD is when you start getting a fearful uncertainty or you’re doubting your position in the market.

FUD caused by a variety of reasons because it could not be done by people intentionally to sway the market downward or even by misinterpretation of good news.

For example: if you buy the coin and it is starting to go down and you’re waiting for it to going up because you did technical analysis or you just want to buy on speculation or somebody told you that coin go up soon, and it started to going down instead of going up.

You’ll start getting fear at same time news comes out and start saying things like this guy lost his money or this exchange got hacked that is basically spreading FUD and they could be doing this intentionally or they might be repeating and trying to give advise but basically making people start to lose their grasp on reality and get scared and panic and sell which is called panic selling.

When you’re in under the influence of fear and panic you do stupid things and that’s how you lose your money basically I am not telling you to completely ignore FUD what I am telling is research about any news before trusting them.

Now let’s understand FOMO.

FOMO

FOMO stand’s for Fear Of Missing Out, basically here also Fear is common situation but in a different scenario.

FOMO is described as a pervasive apprehension that makes you want to stay connected with others are doing, it has been especially relevant since growth in social media networks.

For example, you invested in Bitcoin and now market situation of bitcoin is going down and you hear the news that in a short period Ethereum is skyrocketing in a market, you started to feel oh my god I am missing out that bullish trend on other investment mine is going down and if you decide to buy Ethereum because of news that means you buy on high or you buying something that you don’t really believe in or researched and then it will still going up or go down but it’s usually gone down that’s because of speculation.

Now you understand FUD and FOMO both these emotions are based on fear and they can be devastating for you as an investor and you need to learn how to control them what they are and what to do when they kick in.

There are no exact differences between FUD and FOMO but FOMO is based on a bullish trend in market and FUD is a bearish trend and both feelings are leading towards loss.

If you’re an investor in the crypto market make sure every news are from a legit source and do your analysis to get benefits from these panic situations when others are the victim of FUD and FOMO.