Trading Lesson of the Week

Check back weekly for another free trading lesson:

9 Essentials for Trading Success

In This Week’s Issue:

  • Stockscores Market Minutes Video – Day Trading for Beginners – When to Buy
  • Stockscores Trader Training – 9 Essentials for Trading Success
  • Stockscores Feature Strategy – Abnormal Breaks

Stockscores Market Minutes –

Every aspiring day trader needs to know the key reasons to buy a stock. In this video, I focus on a skill important for the beginner day trader; understanding the reasons for entering a day trade and how I find the stocks I trade each day. Then, my analysis of the overall market and whether another market crash is coming. The day trade of the week on RMBL and a Market Scan in search of opportunities.

Click here to watch this week's Market Minutes video

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Commentary of the Week – 9 Essentials for Trading Success

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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Past Trading Lessons

July 19, 20209 Essentials for Trading SuccessOCGN | AMPE | AGE
July 12, 20205 Things You Need to be a Successful TraderONCS
June 15, 2020Overcome Fear in Favor of Fact
June 7, 20203 Ways to Beat the Stock MarketHEXO | CRON
May 17, 202015 Core Principles for Stock TradersTTOO | ZYNE
April 12, 2020How to Approach the COVIDCrash Market
April 5, 2020Stockscores Webinars in AprilJWN | ALK | DIN
March 20, 2020Navigating the Stock Market CrashTVTY
March 2, 2020There is Strength in WeaknessSPY
February 23, 2020Be Afraid of Fear Based TradingSPY
February 9, 2020Don't Fall in Love (with your stocks)LYFT
February 2, 20203 ways to Improve Trading Profits
January 26, 2020There is Always Another Trading ComingLOGC | MGEN
January 19, 20208 Important Trading RulesT.CRON | T.WEED
January 13, 20203 Ways to Overcome Fear in TradingT.CFX | GSM
December 15, 2019Buy When Pessimism Turns to OptimismT.SNC | JASN | WIFI
December 8, 2019The Bottom Fishing PatternT.WEED | T.APHA
December 1, 20193 Ways to Trade BetterHL | CTRN
November 24, 2019Are Oil Stocks Ready to Move Higher?ERX | T.HEU
November 18, 2019Have Marijuana Stocks Gone Down in Smoke?T.WEED | ACB | CRON
November 3, 2019What You Need to Succeed in TradingT.BIR | T.VII | T.POU | T.MX
October 28, 2019Surprise TradesNAVB | CLUB | AQST
October 20, 2019Beat Your EnemyPDFS | CFFN
October 7, 2019The Basics of Stock Chart Reading
September 30, 2019Trading and Behavioral Science
September 22, 2019Scan the Market For Hot StocksHL | MLNT
September 8, 2019Good Stocks Do Not Go Straight UpOGEN | GTE | EYEN
August 25, 2019What Are the Stockscores?V.SVI | T.PEGI
August 19, 2019Look for Reasons to Say No to the TradeVVUS | CMCM
August 11, 2019What You Can Do to be a Better TraderT.VLE
August 5, 2019Get the Money Out of Mind
July 28, 2019How to Invest in Stocks and Sleep Well
July 21, 2019Essential for Stock Trading SuccessDRRX
July 14, 2019What It Takes to be a Winning TraderT.PTG | AQB
July 8, 2019How Much Money Can You Make Trading
June 23, 2019Avoid Fear Based Trading DecisionsT.PTG | T.ELD
June 16, 2019Keep the Money Out of ItPIRS | KIM | RDUS
June 9, 2019Trading Tactics and StrategySNAP | COTY
June 3, 2019Test Your StrategySATS | RDUS
May 27, 2019Overcoming Emotion in TradingT.NFI | AVP
May 27, 2019Overcoming Emotion in TradingT.NFI | AVP
May 19, 2019Fearlessness in FactsAVXL | BLDP | IIIV
May 12, 2019Traders Must Seek the TruthVXX | UVXY
May 5, 2019No to FOMOOVID | T.BU
April 28, 201915 Core Trading PriniciplesT.REAL | ZYME
April 21, 201910 Ways to be a Better InvestorKEG | CRZO
April 14, 2019How Do You Make Day Trading a Career?PE | T.LUN
April 14, 2019How Do You Make Day Trading a Career?PE | T.LUN
April 7, 2019Gambler or Trader?T.WPRT | T.CJ | T.GTE
March 31, 20193 Ways to Beat the Stock MarketLLNW | ALKS | NM