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9 Ways to be a More Profitable Trader

9 Ways to be a More Profitable Trader
Stockscores Foundation for the week ending March 18, 2024

In this week's issue:

In This Week’s Issue:

  • Upcoming Events – Education Webinars in April
  • Market Outlook – Pockets of Strength
  • This Week’s Market Minutes video – Will the Fed Crash the Stock Market
  • Trader Training – 9 Ways to be a More Profitable Trader
  • Strategy – Abnormal, Liquid Stocks


Upcoming Events – Education Webinars in April


Saturday, April 06, 2024 10:15 AM PT


Wednesday, April 10, 2024 6 PM PT


Thursday, April 11, 2024 6 PM PT


Saturday, April 13, 2024 10:00 AM



Market Outlook – Pockets of Strength

Stocks have been pulling back over the past week or two but there are stocks catching the interest of the crowd every day, making it a market for traders who can take advantage of the volatility. Follow the crowd into hot stocks or sectors. Energy stocks are improving, lots of volatility in precious metal miners and improved buyer interest in the Cannabis stocks for the first time in months. AI stocks still strong with new names popping almost daily.


This Week’s Market Minutes video – WILL THE FED CRASH THE STOCK MARKET?

Inflation concerns have the market lowering expectations for near-term interest rate reductions from the US Federal Reserve and that could bring weakness in stocks, and even a crash. I provide my analysis of the stock, gold, oil, US dollar, Bitcoin, and bond markets. Finally, a look at a simple swing trading strategy with the trade of the week on SOUN.

Click here to watch this week’s video


Trader Education – 9 Ways to be a More Profitable Trader

Here is a list of things that I think are essential to becoming a successful stock trader:

Find Alpha. These are the stocks that are moving on their own story, with less correlation to the overall market. There will be a different list of Alpha stocks every day but they are characterized by abnormal price and volume activity. These attract the crowd, the crowd brings the emotion, emotion causes a break down in market efficiency and that creates opportunity.

Overcome Yourself. Humans are predisposed to fail in the stock market because we have an emotional attachment to money. That clouds our judgment and makes us do irrational things. Computers have been programmed to take advantage of those emotions. To be successful, you have to learn to overcome yourself.

Trade Positive Expected Value. Your trading strategy should be based on logic based rules that can be tested over a large sample size. That testing should show that the strategy makes money consistently through varied market conditions. Just as the odds favor the casino, your strategy should have odds that favor you. Otherwise, you are just the gambler on the wrong side of the table.

Define Your Process. A great strategy is useless if you don’t have the process in place to find and execute the trades before the opportunity is gone. It is not about buying or shorting the right stock. It is about buying or shorting the right stock at the right time. With a sound process, even the best strategy will fail.

Have Optimism. You are what you think. If you are negative then you will get negative results. With optimism, you can overcome the hard times and find your path to trading success. Optimism does not mean recklessness, for that is the way of the gambler who seeks fast riches without the hard work.

Work Hard. Once your trading strategy is defined and your emotions under control, trading is not that difficult. However, getting to that point takes hard work, discipline and perseverance. Many aspiring traders fail because they give up.

Focus. The market can change direction very quickly. If you are not focused, you can miss opportunities or quickly watch a good trade turn in to a bad one. When you are trading, trade.

Have a Plan. Without a well thought out and tested trading plan, you will succumb to your emotions when trading gets difficult. The plan should be concise enough for a computer to follow. Don’t leave room for judgment because your judgment will be clouded when you risk your capital.

Have an Edge. You are competing against millions of other traders. To win, you have to have an edge. That could be better information, a better strategy, better technology, better emotional control or anything else you can find that most people don’t have.

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I like to start my stock search with a focus on stocks trading with abnormal volume and making strong price gains. The reason is simple; almost every market beating trend starts with abnormal price and volume activity. The key is find the stocks that surprise with strength and have a big enough crowd following them

T.WEED (CGC) - Cannabis stocks have been strong for the past few trading sessions as rumors circulate that they will be removed from the dangerous drug category by the US government. The stocks in this sector have an uphill battle against long term pessimism but are worth considering by swing trader who can take advantage of the abnormal price volatility and optimism that is building. Trade these stocks off of their 15 or 30 minute charts, buying breaks of pullbacks in the upward trend.

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PIXY - another stock that came alive with abnormal price and volume activity on Monday, with very strong liquidity of nearly 80,000 trades. This stock has very few shares outstanding and tradeable so strong demand can cause it to make fast gains. Will be very volatile and should be traded off of the intraday price patterns, ideally buying breaks of pullbacks.

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This is not an investment advisory, and should not be used to make investment decisions. Information in Stockscores Foundation is often opinionated and should be considered for information purposes only. No stock exchange anywhere has approved or disapproved of the information contained herein. There is no express or implied solicitation to buy or sell securities. The writers and editors of this newsletter may have positions in the stocks discussed above and may trade in the stocks mentioned. Don't consider buying or selling any stock without conducting your own due diligence.

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