Finding Leading Stocks

Every Market Cycle Has a “Big Stock.” But the Real Clue Is Usually the Industry Group Behind It.

The market’s biggest winners rarely emerge alone. They are usually part of an industry group benefiting from a powerful new fundamental trend.

2023: AI Compute and Semiconductors

This marked the beginning of a new bull market and the emergence of the generative AI theme.

Big leaders:

• $NVDA | Nvidia

• $SMCI | Super Micro Computer

NVDA became the face of the cycle, but the leadership was much broader. Chips, servers, networking equipment, and the entire data-center buildout were beginning to move.

2024: AI Software, Data Platforms, and Power

Leadership expanded from companies building the AI infrastructure to those finding ways to monetize and support it.

Big leaders:

• $PLTR | Palantir

• $APP | AppLovin

AI adoption spread into software, data platforms, advertising optimization, networking, and power generation. The theme was evolving, but the underlying driver remained the same.

2025: Memory, Storage, and the AI Data Stack

The market’s attention shifted toward the next major bottleneck. AI systems required enormous amounts of high-performance memory, flash storage, and data-center capacity.

Big leaders:

• $SNDK | SanDisk

• $WDC | Western Digital

• $STX | Seagate Technology

• $MU | Micron Technology

These became some of the market’s biggest winners as demand for AI memory and storage accelerated.

2026: The Memory Supercycle Continues

Leadership continued into 2026 and semiconductors remerged as a leading group rather than transitioning into an entirely new theme.

Leaders:

• $SNDK | SanDisk

• $MU | Micron Technology

• $STX | Seagate Technology

• $WDC | Western Digital

But don’t overlook what happened outside the dominant AI theme.

Metals and mining also developed into a major winning group during this bull market period 2024-2026. The market can have one dominant secular story while still producing powerful leadership in completely different areas.

The next monster winner probably won’t be random.

It will likely emerge from a strengthening industry group with accelerating earnings and sales, increasing institutional sponsorship, elite Relative Strength, and a chart that refuses to break.

2023: AI compute and semiconductors

2024: AI software, data platforms, and power

2025–2026: AI memory, storage, semis

Meanwhile, metals and mining proved that major leadership can still emerge outside the market’s primary theme.

What industry group do you think becomes the next true market leader for 2026–2027?

What Leader Is Still Standing?

The market looks ugly, but the individual stock scans may look even worse.

Many of the leading stocks from the past year have suffered meaningful technical breakdowns. With SNDK now confirming its breakdown below the 50-day moving average, it joins MU, STX, WDC, and a growing list of former leaders that have lost important support.

Since the market set its low on March 30 and began a new Stage 2 uptrend, which leaders are actually still standing?

Post a chart of a leading stock in a leading industry group that has not suffered a meaningful technical breakdown. Let’s see which former leaders are still holding up, if there are any.

Stop Waiting for Someone to Hand You the Next Big Winner

If you are struggling to find the big winning stocks, you do not need to wait around for me or anyone else to tell you the names.

Open the Relative Strength Stock Screener and click the Leader / CANSLIM preset stock screen.

You will immediately see many of the market’s strongest names near the top of the list.

As you scroll through the list, some names will be extended. Those go on your watchlist so you can wait for the next proper pullback or setup.

Some will be near pivot points.

Some will already be actionable.

That is the entire point of the screener.

It is not there to overwhelm you with tickers. It is there to help you quickly identify where the real leadership is.

This is the same exact process I have used to find and share many of the biggest winners since January.

Names like:

SNDK

MU

AAOI

AXTI

DELL

CIEN

LITE

WDC

STX

SIMO

and many more!

Your job is to build the habit of checking the list, following the leaders, managing risk, and being ready when the setup appears.

Everything you need to learn the process is inside the Momentum Trading Strategy Course. I also provide a list of books that teach many of the same timeless principles.

Learn the process.

Use the tools.

Trust yourself.

You can do this.

Stocks gapping up to, or near, new highs this morning:

MU, WDC, STX, INTC, TTMI, TER, ALAB, AMD, VSH, LSCC, STM, TSM, and ADI.

The Multi-Bagger Irony

A lot of stock newsletters sell people on the hope of finding the next multi-bagger.

A 100%, 200%, or 300% winner.

Many talk about holding for years to get the big returns.

What people don't realize is this:

By the time you figure out they were full of it, they already made plenty of money selling you the hope.

The funny thing is, I don't even teach or claim to give people multi-baggers.

But many investors would likely get similar or better results by learning how to identify true growth stock leadership, proper setups, institutional demand, and strong price action.

Here are a few names I mentioned in January and early February:

• AAOI +302%

• AXTI +294%

• SNDK +249%

• DELL +214%

• MU +160%

• LITE +155%

• CIEN +147%

• STRL +127%

• STX +126%

• WDC +124%

• INTC +101%

• AMD +101%

These were discussed in the paid subscriber chat and watchlist posts.

But to be clear, this is not what I do here.

I'm not telling you to blindly buy a stock and hold it until it becomes a multi-bagger.

The goal is to teach you how to find leadership, manage risk, identify proper entries, and build a repeatable process.

Stock Screening: The Same Names Keep Showing Up

There is no surprise here.

Most of the names I liked in my weekend scanning are the same names we have been talking about for months.

The best stocks usually keep showing up.

STX is one of them.

It is moving back toward new highs, and it still has a lot of the characteristics I want to see:

• Strong earnings growth.

• Strong sales growth.

• High relative strength.

• Strong ROE and margins.

• Increasing fund ownership.

• A strong industry group.

• Price action aligned with the current bull market theme.

This is not about finding something obscure.

It is about finding strength, tracking it, and staying aligned with it as long as the evidence remains intact.

Eventually, every trend ends. The setups will stop working, the leaders will break down, and the market will rotate somewhere else.

But if you have been doing this correctly, by the time that happens, the gains from the trend should more than offset the normal losses that come when the move finally ends.

That is the whole point of following leadership.

You are not trying to be right forever.

You are trying to stay aligned while the evidence is there, and then get out when the evidence changes.

The Leaders Were Hiding in Plain Sight

Back in January, when I first started sharing names, SNDK, MU, STX, and WDC were some of the stocks I kept coming back to.

Why?

Because they checked almost every box.

• They were aligned with the dominant bull market theme: AI.

• They were sitting inside a hot industry group.

• They were among the strongest stocks in that group.

• They had explosive earnings growth, big sales growth, strong margins, high return on equity, and elite relative strength.

That is not complicated. That is exactly what the legendary growth stock traders have been teaching for decades.

Look for the strongest stocks, in the strongest groups, supported by the strongest fundamentals, during a confirmed bull market.

Were there other high-flying names?

Of course.

But many of them did not have all the ingredients these names had.

The only major O’Neil-style box these stocks have not consistently checked is the three-year annual EPS growth requirement of 25% or greater each year.

But outside of that, they had almost everything you want to see in a potential market leader.

And today, finding these names is easier than ever.

This Is Why You Track Leadership Before Everyone Else Sees It

On April 8, the market gave us the signal.

We had a follow-through day, the NASDAQ-100 reclaimed key moving averages, including the 50-day and 200-day, and the conversation shifted from defense back toward offense.

But the real edge was not just knowing the market was improving.

The edge was knowing where to look.

When the market gets stronger, I want to be focused on the strongest industry groups and the strongest stocks inside those groups.

That is exactly what we had been tracking for months.

• Telecom.

• Computer Data Storage.

• Semiconductors.

Many of these names were not random new ideas. They had already been showing up in our work, some for months, and some even last year.

So when the market confirmed on April 8, there was no need to bounce around looking for the next hot ticker.

The leadership was already there.

From the April 8 signal to yesterday’s close:

AAOI up 40%

LITE up 12%

CIEN up 12%

VIAV up 30%

SNDK up 81%

WDC up 38%

STX up 53%

TER flat

AEIS down 4%

AEHR up 50%

LRCX up 12%

FIX up 30%

GLW flat

Not every stock works.

That is normal.

But when the market confirms, and multiple stocks from the same leading groups start moving together, that is usually not a coincidence.

That is institutional money flowing into a theme.

Strong market.

Strong industry groups.

Strong stocks.

That is the process.

The goal is not to chase every move.

The goal is to already know where the strength is clustering before the move becomes obvious.

This Is What Real Leadership Looks Like

It’s not a coincidence.

When we look at the Top 10 Industry Groups right now, we’re seeing clear clustering of strength:

• Telecom: AAOI, LITE, CIEN, VIAV

• Computer Data Storage: SNDK, WDC, STX

• Semiconductors: TER, AEIS, AEHR, LRCX

All showing up in the top groups.

This is exactly how leadership reveals itself.

It’s not just one stock. It’s clusters of strength moving together.

When you start seeing multiple names across the same industry groups all:

• Breaking out

• Showing strong relative strength

• Backed by strong fundamentals

That is not random.

That is institutional money flowing into a theme.

This is how real trends work.

Stay focused on where the strength is clustering, just like we teach in the MTS Course. https://tradingmomentum.substack.com/s/mts-course

How do we find the strongest names in the strongest groups?

Relative Strength Stock Screener.

Use it now as part of the MTS Web App https://momentumtradingstrategy.app/

That’s where the opportunity is.

Why I Mentioned AAOI Before Earnings

Someone asked why I mentioned AAOI in early February with earnings coming up.

First, the stock checked several boxes I look for.

It was in a HOT group (telecom) showing strong relative strength across multiple timeframes. I had already seen success with LITE and CIEN, which are in the same space. It reminded me of past industry runs like the computer data storage group when SNDK, MU, WDC, and STX all moved together.

AAOI also had:

• Strong earnings and sales acceleration

• Rising forward estimates

• Accelerating fund ownership

• Tight price action on the right side of the chart

• Trading near new 52 week highs

Since that mention the stock has moved about 150%, but the trade management is the important part.

I normally do NOT buy a stock a few days before earnings. There is too much risk and no time to build a cushion.

I follow the advice from Paul Tudor Jones:

“Never trade in situations where you don’t have control. For example, I don’t risk significant amounts of money in front of key reports, since that is gambling, not trading.”

In this case there were about three weeks before the report, which gave the trade time to work.

From the original buy, the stock moved roughly 30% before earnings.

At that point the plan becomes simple:

• Trim a large portion before the report

• Lock in gains and reduce risk

• Hold a smaller position into earnings

Even great stocks can drop 15–20% overnight on earnings.

By trimming beforehand, the position already has a profit cushion, so the remaining shares carry much less risk.

This is something I learned studying the playbooks of William O’Neil, Mark Minervini, and David Ryan.

The goal isn’t predicting earnings.

The goal is managing risk while letting strong stocks work in your favor.

Study This Chart: One of the Best Low Risk Breakout Setups

This chart is a perfect example of the type of setup we look for.

The stock is sitting inside a subsector that supports the main market theme right now, AI. When a subsector is strong, it tends to lift the entire group. That is why you see other names in the space acting well too, like Micron Technology, Western Digital, and Seagate Technology.

Now zoom in on the important part.

What makes this a premium setup is that it checks the fundamental boxes that show up in many of the biggest winners of all time, the type of characteristics William J. O'Neil wrote about after studying market history going back over a century.

But fundamentals alone are not what makes this special.

The real edge is the price action.

1) High relative strength

When a stock has RS in the 90s, it is telling you institutions are already voting with their money. This is what you want in a true leader.

2) Big earnings and big sales

Strong numbers are the fuel. Price action is the trigger. When both line up, it is hard for the market to ignore.

3) Big move up, then price tightens

This is the cheat code. A strong advance followed by tight price action. That is where the market gives you a gift.

Tightening action does two things.

• It shows supply is drying up.

• It gives you a clean place to define risk.

Why this is low risk and high reward

When price tightens near highs and then breaks out, you can build a trade that is asymmetric.

You are not guessing. You are defining a level that proves you wrong.

If it fails, you are out quickly.

If it works, you can ride a trend and manage it.

That is how you end up with trades that can pay 3R, 5R, even 10R plus while keeping the downside controlled. Study what what it looks like before and after.

Data Storage Quietly Became One of the Strongest Leadership Groups in the Market

While everyone kept talking about chips, metals, and AI all year, the real expansion of this bull cycle has been happening somewhere else: data storage.

MU, WDC, STX, and even SNDK have been posting massive earnings and sales acceleration. SNDK has not delivered the same near-term numbers, but analysts and funds are clearly positioning for future growth and the stock has surged alongside the leaders.

This entire group started emerging back in April. Since then, the charts, the tape, and the fundamentals have all lined up.

This is exactly why serious traders track relative strength stocks and relative strength industry groups. Leaders rarely move alone. The biggest moves come when multiple stocks in the same industry begin showing strength at the same time, which is a sign that big money is rotating into that group.

When a major theme like AI takes hold, leadership does not stay static. It expands. And by the time most people finally recognize the True Market Leaders, the next group is already breaking out.

Watch the stocks. Watch the groups. Watch the earnings and sales.