First, I would get rid of that stupid nut and put a gnarly squire strat plastic nut on that baby.
Secondly, the tuners are much too stiff, grab some awesome chinese squire strat tuners and plop them on.
Next, the frets are probably on too well and in the right spots, so (you guessed it) replace the neck with a squire strat one.
At the same time, the pickups are not pulling hard enough on the strings, so you better replace those with squire pickups as well.
Lastly, the body is probably too heavy, so might as well replace that with a squire one too.
Good luck,
Rory