15 Core Trading Priniciples
Stockscores Foundation for the week ending April 29, 2019
In this week's issue:

In This Week’s Issue:
- Stockscores’ Market Minutes Video – Trading the Second Signal
- Stockscores Trader Training – 10 Ways to be a Better Investor
- Stock Features of the Week – Stockscores Simple
Stockscores Market Minutes – Trade the Second Signal
When trading stock breakouts, we can take the initial break or wait for a break of the first pull back in the upward trend. This week, I show what I mean by that before providing my analysis of the overall stocks market, do a search for trading opportunities and look at the trade of the week on $HEXO.
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Commentary of the Week – 15 Core Trading Principles
Here are 15 Core Trading Principles that every trader should understand and respect:
Follow the Action
Stocks that beat the market and provide the best profits trade with abnormal price and volume activity. Focus on these stocks.
Don’t Fight the Trend
More than ever, trading in the direction of the overall market trend will have a major effect on your performance. Short when the market is moving lower, buy when the market is moving up. Focus on the sectors of the market that are leading in either direction.
Be Patient with Winners
Avoid selling winners because it feels good to do so or because they have hit your price target. Never limit upside, just sell when the upward trend is broken.
Have No Patience with Losers
Being wrong is part of trading. What you do with your losers will determine your trading skill. For every trade that you take, know the price level where the market will prove you wrong and get out when it hits that price.
Do the Work
Trading is simple, but it is not easy. Take the time to learn and gather experience. Compile data to prove the worth of your trading strategies and never stop evolving your trading skills.
Don’t Fall in Love
The more you know about a company, the greater the risk that you will fall in love with it and ignore the negative signals that the market gives you. Treat every stock as a symbol that you are just as willing to sell as you are to buy. Keep your emotions out of it.
Respect Your Tolerance for Risk
We make emotional trading mistakes because we are afraid of losing money. If we take a risk level we are comfortable with, there is less chance we will get emotional.
Don’t Expect to Always be Right
You don’t make money in the market by being right, you succeed by making more when you are right than you lose when you are wrong. When the market tells you are wrong, believe it.
The Stock Market is Not Fair
Most investors are trading on information that is publicly available. Some investors are trading on better information that is not widely known. To be successful, you either have to have better information or follow those who do.
Don’t Aim for Perfection
All traders make mistakes, miss good opportunities and take questionable ones. Don’t get frustrated by the inevitable errors. Put your focus on being as good as you can be.
You Can Make More by Trading Less
Take the best trading opportunities, not the marginal ones. Bad traders act on their fear of missing out. Good traders sacrifice catching every winner in favor of maximizing their overall profitability. There is nothing wrong with doing nothing when conditions are not good for trading.
The Market Will Do Things That Don’t Make Sense
A market’s move is rarely explainable until after the move happens because the market trades on information that most traders don’t have. Don’t doubt the market’s movements, you probably don’t have all the facts.
Gamblers Lose
Good traders have a strategy that they have tested over a large sample of trades to understand the probability and profitability of success. Gamblers trade against the odds because they don’t know what they are.
Never Buy More of a Loser
If your analysis of a stock is correct, the trade will show a profit. If it is losing then you have only been proven wrong. Don’t make being wrong worse by adding to the position.
Add to Your Winners
When you are right, add to the position as long as you are not adding on more risk than you are comfortable with. The risk of your added positions should be mitigated by the profits from the earlier entries.
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The Stockscores Simple Market looks for stocks with a Sentiment Stockscore of at least 60 and a Signal Stockscore over 80 or higher. We then apply chart pattern recognition to find those stocks with good potential. Here are two candidates:

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