Market Conditions

The Wall Street Figure the Market Wizards Paid Attention To

One thing that stood out to me while reading Jack Schwager’s Market Wizards was how often some of the greatest traders of the modern era mentioned the same analyst they respected and followed:

Marty Zweig.

Bruce Kovner.

Michael Marcus.

Richard Dennis.

Paul Tudor Jones.

Different traders. Different styles. Different markets. Same respect for Zweig’s work.

That is what made me pick up Winning on Wall Street.

My foundation has always been built primarily on William O’Neil, CAN SLIM, and Mark Minervini’s work. But Zweig helped me understand the “M” in CAN SLIM, market direction, at a deeper level.

O’Neil taught the importance of understanding the general market. Even Mike Bellafiore has written about why day traders need to understand the big picture. Zweig helped me connect those ideas with monetary policy, the Fed, market momentum, sentiment, and tape action.

That is one of the reasons I expanded my own Big Picture Market Pulse and why I do it every weekend.

This article breaks down Marty Zweig’s most important rules and why they still matter for growth stock investors, momentum traders, and anyone trying to stay aligned with the market’s major trend.

https://tradingmomentum.substack.com/p/marty-zweigs-rules-dont-fight-the

Why the Best Stocks Usually Come From the Strongest Industry Groups

Most traders are obsessed with finding the right stock.

But the better question is:

Is this stock in the right neighborhood?

William O’Neil taught that the majority of leading stocks are usually found in leading industries.

That matters because studies show that 37% of a stock’s price movement is tied to the performance of its industry group, and another 12% comes from the strength of its broader sector.

In other words, roughly half of a stock’s move can be influenced by the strength of the group it belongs to.

Then add the “M” in CAN SLIM: market direction.

O’Neil also taught that roughly three out of four stocks follow the overall market trend.

So if you are buying a stock in a weak market, inside a weak sector, inside a weak industry group, you are not just making a stock pick.

You are fighting probability.

That is why I put so much emphasis on:

• Market direction.

• Sector strength.

• Industry group leadership.

• Relative strength.

Leading stocks inside leading groups.

Recently, that has meant paying close attention to areas like technology and semiconductors, because that is where a lot of the real leadership has been.

The goal is not just to find a good company.

The goal is to find a strong stock, in a strong group, aligned with the strongest market theme, while the general market is supporting risk.

Before buying a stock, ask:

• Is the market helping or hurting me?

• Is the sector leading or lagging?

• Is the industry group attracting money?

• Is this stock one of the strongest names in that group?

Because the best stock ideas usually do not happen in isolation.

Leadership clusters.

Money rotates.

The strongest stocks are often found where the strongest institutional demand is already flowing.

Is My Indicator Broken?

The Nasdaq-100 Index just triggered an ATR% Extension Signal that has not appeared since January 3, 2000.

With the current settings, the signal appears when price is at least 10 times the 14-period ATR above the 50-day moving average. The index is extremely extended above its intermediate-term trend.

That deserves respect.

This is not a sell signal by itself. Strong markets can stay extended longer than most traders expect, and momentum can continue even after rare extension signals appear.

This is a clear reminder that after a powerful six-week advance, chasing extended strength is not the same as buying a low-risk setup from a month ago.

The trend is still up. Growth leadership remains intact, but risk/reward has changed.

At this stage, discipline matters more than excitement.

Pullbacks, shakeouts, and consolidation would be completely normal from here. The better opportunities will likely come from leading stocks that reset, tighten, and offer cleaner entries, not names already stretched far above their moving averages.

The market is still saying yes, but let’s not confuse strength with a free pass to chase or abandon discipline.

Read this week’s Big Picture Market Pulse:

https://tradingmomentum.substack.com/p/big-picture-market-pulse-may-9-2026

ALL-TIME HIGHS AGAIN

“The trend is your friend except at the end where it bends.”

-Ed Seykota

Growth stocks continue to press higher, with the Nasdaq-100, Nasdaq Composite, and S&P 500 pushing into record territory again.

The market is still giving growth investors the green light, but after a sharp six-week move off the lows, risk/reward has changed. Step back this weekend and understand the big picture before diving back into individual stock selection.

Read this week’s Big Picture Market Pulse:

https://tradingmomentum.substack.com/p/big-picture-market-pulse-may-9-2026

The Market Told You Before the News Did

Remember when everyone was scared to buy?

• “The ceasefire didn’t hold.”

• “AI is going to take everyone’s jobs.”

• “Inflation is back.”

• “The market is in a bubble.”

There is always a reason to be scared.

But the job of a trader is not to sit around reacting to every headline.

The job is to follow the price action.

On April 8, the market gave us a signal.

QQQ reclaimed key moving averages, the follow-through day confirmed, and the strongest groups and strongest stocks led the way.

That was the message.

Not the news.

Not the fear.

Not the social media panic.

The market will usually tell you more than any news feed ever will.

Instead of spending hours a day listening to people explain why you should be afraid, imagine spending that time learning how to actually read the market like the great traders did.

The Market Wizards were not great because they predicted every headline.

They were great because they knew how to read price, manage risk, and follow strength.

Stop letting the news think for you.

Learn to read the market.

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.

Before You Look for Stocks, Read the Market First

Before the market opens, step back and read the big picture.

This is not the glamorous part of trading.

It is not a hot stock pick. It is not a prediction. It is not some exciting new indicator.

It is repetition.

Every week, we check the same things: trend, breadth, leadership, volatility, distribution, rates, credit, liquidity, relative strength and more.

That is the point.

William O’Neil made Market Direction the “M” in CAN SLIM for a reason. Mike Bellafiore teaches day traders to understand the big picture for a reason. Many of the Market Wizards, including Michael Marcus, Bruce Kovner, Richard Dennis, and Paul Tudor Jones, studied Marty Zweig’s work for a reason.

Great traders do not operate in a vacuum.

They understand the environment first.

This week’s Big Picture Market Pulse breaks down where the market stands, what continues to lead, and where relative strength is showing up beneath the surface.

Read it before the open. Then go stock hunting.

https://tradingmomentum.substack.com/p/big-picture-market-pulse-may-3-2026

Most Traders Wait Until It Feels Safe. That’s Why They Miss the Move.

The best market opportunities rarely feel comfortable.

They usually show up when the headlines are scary, social media is bearish, your gut feels uncertain, and every “smart” person has a reason why the market should go lower.

That is exactly what happened back around April 8.

The market had broken down after a multi-month Stage 3. The Nasdaq 100 was below key moving averages. Breadth was horrible. Net new lows were greatly outpacing net new highs. Most traders were scared, and bearish.

Then the market established a low and started moving higher.

For shorter-term swing traders, the early signal may have been price reclaiming the 10-day and 20-day moving averages.

For longer-term traders, the more important signal may have been price reclaiming the 50-day and 200-day moving averages.

The timeframe can be different.

The signal can be different.

But the principle is the same:

When the market starts improving after fear has already been priced in, those are often some of the best low-risk, high-reward areas to begin making pilot buys.

Not full exposure.

Not reckless buying.

Not blindly calling a bottom.

Just controlled, risk-defined entries when the evidence starts to shift.

Even if you waited until the big gap-up day on April 8, there were still a few days, April 8, April 9, and April 10, where traders had a chance to start getting back involved before the market stormed higher again.

But most people did nothing.

They were paralyzed by fear.

They had reasons.

Geopolitics.

Headlines.

Failed ceasefires.

Recession talk and AI driven job losses.

Inflation and supply chain disruptions.

Social media panic.

Very intelligent analysis explaining why they should stay out.

But the market does not pay you for having intelligent reasons to be scared.

It pays you for understanding risk and reward.

In that area, a trader could have entered with a defined stop around the 50-day or 200-day moving average, risking roughly 2% or less depending on the entry.

From there, the market has already moved roughly 11%.

That is more than five times the risk.

That is the entire point.

You do not need to know the future.

You need a repeatable strategy where the upside is meaningfully larger than the downside.

Even if you are wrong several times, one good trade can pay for the small losses and still leave you profitable.

That is why beginners struggle.

At the exact moment they should be testing the market again, they are frozen.

By the time they finally feel safe, the low-risk entry is gone.

Learn a strategy that has worked for decades.

Study price.

Study how markets move.

Study risk/reward.

Study the greats.

Then follow the process when it matters most.

One final point:

Yes, instinct matters.

Some of the best traders in history developed a real feel for the market and the tape.

But if you are new, your instincts are probably not market intuition yet.

They are fear, recency bias, and emotional self-protection.

Real instinct is earned through thousands of hours, repetition, losses, corrections, and experience.

Until then, trust the process more than your feelings.

That is how you stop reacting like the crowd.

That is how you start thinking like a professional.

This is what we study inside Momentum Trading Strategy.

You Can Sit Out Half the Year, Be Wrong 65% of the Time, and Still Finish Up Triple Digits

Most traders think a big year comes from constantly trading.

It doesn’t.

A big year usually comes from knowing when to press the gas and knowing when to do absolutely nothing.

Look at the chart.

The blue areas were no-trade zones.

That is not weakness.

That is discipline.

In this example, the real opportunity window was the Stage 2 uptrend from around May 12, 2025 to November 14, 2025.

That is where the system gets to work.

Here’s the point:

A trader could spend 82 trading days doing nothing, have 104 losing trades, win only 35% of the time, and still have a triple-digit year.

How?

Because the winners are much larger than the losers.

Example:

35% win rate

25% exposure per trade

17% average gain

5% average loss

That means:

A winner adds about +4.25% to the account.

A loser subtracts about -1.25% from the account.

Over the year:

56 wins × 4.25% = +238%

104 losses × 1.25% = -130%

Simple net return: +108%

Estimated compounded return: +178.05%

That is with only a 35% win rate.

Now compare that with a trader who wins more often, but has a smaller gain-to-loss spread.

Example:

50% win rate

25% exposure per trade

14% average gain

7% average loss

A winner adds about +3.5% to the account.

A loser subtracts about -1.75% from the account.

Over the year:

58 wins × 3.5% = +203%

58 losses × 1.75% = -101.5%

Simple net return: +101.5%

Estimated compounded return: +164.14%

That trader could also spend around 120 days not trading at all and still finish with a triple-digit year.

This is why win rate alone is not the game.

The real game is:

Knowing when conditions are right.

Avoiding the chop.

Keeping losses controlled.

Pressing when the market is rewarding your system.

Letting the math work over a large enough sample.

You do not need to trade every day.

You do not need to be right all the time.

You need a system with positive expectancy, enough discipline to sit in cash when conditions are poor, and enough conviction to press when the window opens.

The Bull Is Still Alive, But It Needs to Breathe

This week’s Big Picture Market Pulse is out.

Like I say every week, the weekend is the best time to step back and review the big picture before diving into your stock screening.

Zoom out first. Then zoom in.

That process is always easier when the market is closed.

The major indexes are at or near all-time highs, growth stocks are leading, and the AI theme remains firmly intact.

That is bullish.

But after four straight powerful weeks higher off the lows, the market is no longer early in the move.

That does not mean the market is bearish.

It means the next phase requires more patience and selectivity.

Inside this week’s report, I cover:

• Why the bull trend remains intact

• Why growth stocks are clearly leading

• Which groups are leading now

• Why breadth cooling matters, but is not bearish yet

• Why chasing extended names is the biggest risk right now

• What I want to see next for the rally to remain healthy

The trend is bullish.

Growth is leading.

But after a move this fast, the best opportunities will likely come from discipline, not chasing.

https://tradingmomentum.substack.com/p/big-picture-market-pulse-april-26

Trade the Market You’re In, Not the One You Want

Something Mark Minervini said in the Master Trader Program really stood out to me.

It was about understanding the market environment… and how that should impact your trading.

A lot of traders label themselves.

“I’m a swing trader.” “I’m a position trader.”

And for years, you hear the same advice.

Pick one. Master it.

But that is not how the best traders actually operate.

Minervini does both.

And the reason is simple.

The market changes.

There are environments where shorter-term trading makes more sense.

You take quicker profits. You manage risk tighter. You stay nimble.

This often shows up in more extended markets. Middle to later stages of a bull cycle.

You are not trying to hit home runs.

You are taking what the market is giving you.

Then the environment shifts.

After a major correction. After a bear market. Early stages of a new bull cycle.

That is when the opportunity changes.

That is when the best stocks can make outsized moves.

That is when it makes sense to press. To hold longer. To think more like a position trader.

This lines up with how traders like William O’Neil and David Ryan approached the market.

And it aligns directly with what Van K. Tharp taught.

Understand the environment. Adjust accordingly.

This is what separates professionals from everyone else.

Most traders stay rigid.

They try to force one style onto every market.

But the reality is simple.

Different environments require different tactics.

You do not need to pick a label.

You need to read the market.

And when you do that, everything starts to make more sense.

Stop Guessing Stocks Start Reading the Market First

Why the best traders in the world zoom out before they zoom in

Ever notice how some trades just work… and others fail no matter how perfect the setup looks?

That is not random.

It is the market environment.

Before you even look at a chart, before you scan for breakouts, before you convince yourself this one is different, there is a quieter question sitting underneath everything:

Is the market actually supporting your trade?

The best traders in the world understood this long ago.

In Market Wizards, Paul Tudor Jones, Bruce Kovner, Michael Steinhardt, Ed Seykota, Larry Hite, Richard Dennis, William O'Neil, and David Ryan all approached the market differently.

But they all shared one thing.

They stepped back first.

They did not start with the stock or individual security.

They started with the environment.

Because the market is not just a backdrop. It is the force that determines whether a trade has a higher probability of working.

That is exactly why we write the Big Picture every weekend.

Not because it sounds professional. Not because it looks organized.

But because it answers the only question that really matters:

Are conditions aligned or are you fighting the tape?

When the market is strong, setups follow through. When the market is weak, even A setups fail.

Simple. Not easy. But simple.

If you are not doing this yet, it is worth asking yourself why.

Because at the highest level, everyone arrives at the same conclusion.

Understanding the environment tells you where to look, when to press, and when to step aside.

Stepping back is what allows you to focus in.

👉 Read this week’s Big Picture Market Pulse here.

https://tradingmomentum.substack.com/p/big-picture-market-pulse-april-19

All-Time Highs… and Most Traders Still Missed It

The market went from breakdown to new highs in weeks

Price led Breadth confirmed Leaders moved first

The signals were there

The problem wasn’t knowledge

It was hesitation

This is what most traders missed ↓

https://tradingmomentum.substack.com/p/big-picture-market-pulse-april-19

Price Gave the Signal. Not the News

I didn’t decide to get back into the market based on a feeling.

Or a belief.

I wrote in a Substack note and told subscribers:

It’s time to start getting involved again and slowly increase exposure.

That decision was based on price.

We had a follow-through day.

Not just one or two up days…

Several days of strength.

Price reclaiming the 200-day. Price reclaiming the 50-day. Leading stocks breaking out to new highs.

That’s the signal.

And there was a major learning lesson over the last couple of weeks.

Some of you leaned into it.

Some of you ignored it.

I had people tell me they were staying out because of the news.

The situation looked worse. The ceasefire failed. More uncertainty.

But this is exactly the trap.

In the long run, not every time, but in the long run, that type of thinking keeps you on the sidelines when you should be participating.

Could the follow-through day have failed?

Of course.

That’s why we don’t go all in.

That’s why we start small.

That’s the entire purpose of the follow-through day.

It’s not certainty.

It’s a signal to begin.

Even if it’s 1% of your capital, it’s about putting a toe back in the water and letting the market prove itself.

When price is above key moving averages and leadership is emerging, sitting on the sidelines “waiting for clarity” usually means missing the move.

This is a perfect example of how human emotion can prevent you from doing the right thing.

Price gave the signal.

The question is… did you listen?

The Strongest Stocks Don’t Go Down (Even When the Market Is Falling)

Most traders wait for the market to confirm the move.

By the time it does… the best stocks are already gone.

Dan Zanger explained it simply:

“Leadership stocks will be sitting near new highs while the market is still falling.”

Think about that.

The market looks weak… headlines are negative… everything feels like it’s going lower.

But a few stocks?

They refuse to go down.

They sit near highs. They break out. They explode on earnings and volume.

By the time you’re waiting for the S&P 500 or Nasdaq to break resistance…

The leaders have already moved.

The real tell is this:

• 3–5 stocks holding near highs during a weak market

• Powerful earnings driving explosive moves

• Breakouts on massive volume

• Gap ups while the market is still struggling

That’s where you focus.

On the strongest industry groups… and the strongest stocks within those groups.

They’ll tell you when the market is about to turn.

Trade Less. Make More.

Most traders don’t lose because they miss opportunities…

They lose because they trade too often.

Back in 2005, Dan Zanger was asked his biggest lesson. He said:

“The market may have two big moves during the year… they last 6 to 12 weeks. The rest of the time, the market is just consolidating the gains… the big lesson for me has been to trade less.”

Two real opportunities a year.

The rest? Noise.

And this isn’t coming from a long-term investor.

This is coming from a swing trader who compounds through frequency… not just time.

A guy who turned $18K into over $18 million.

He understood something most traders don’t:

It’s not always time to press.

It’s time to wait for the conditions to press hard.

Yet most traders are in the market every day… forcing trades… giving it all back.

The play is simple:

• Wait for good market conditions

• Focus on a few true leaders

• Ride the move

• Then go to cash and wait again

Trade less.

Wait for the real move.

Then press.

All Time Highs and You’re Still Waiting?

The S&P 500 and Nasdaq-100 are at all time highs.

A few weeks ago, both were below their key moving averages.

Strength showed up off the lows. Then we reclaimed the 200-day. Then came the follow through day.

That was the signal.

Not certainty. A signal.

If you saw my last note, you know exactly when that happened.

Look at the charts.

While headlines stayed negative, the market moved higher, reclaimed key levels, and never looked back.

A lot of people were saying things like, “But the Iran news… the ceasefire fell through… there’s no deal.”

And that’s exactly the point.

By the time you’re reacting to the news, the market has already priced it in… or decided it doesn’t matter.

Don’t let politics or doom and gloom headlines keep you on the sidelines.

Look back through history. During many periods of war and uncertainty, the market quickly absorbs the information and moves higher while most people are still expecting a crash.

Most people waited for confirmation from the news. The move had already started.

That’s the difference.

The market doesn’t care about narratives. It reflects reality faster than we can interpret it.

Your edge isn’t predicting headlines. It’s learning to read price.

If you were waiting for everything to make sense, you missed it. If you were following the signal, you were already getting involved.

👉 https://substack.com/@tradingmomentum/note/c-240105017?r=5ccg85&utm_source=notes-share-action&utm_medium=web

Most Traders Get This Backwards

They get bullish at the top

And bearish at the bottom

That’s why they lose.

Warren Buffett said it best:

“Be fearful when others are greedy, and greedy when others are fearful.”

Most people hear that and think it only applies to value investing.

It doesn’t.

It applies to trend following.

It applies to growth stocks.

It applies to momentum.

When fear is high, leaders are quietly setting up.

When greed is everywhere, risk is at its highest.

The crowd chases emotion.

Professionals follow process.

If you can train yourself to do the opposite of what feels comfortable…

You’re already ahead of 90% of traders.

The Market Just Flipped. Most People Haven’t Noticed Yet.

Big changes took place last week.

Major indexes are now back above the 200-day.

That alone should get your attention.

But here’s the problem…

Most traders skip this step entirely.

They jump straight into stocks.

Setups. Entries. Indicators.

Without ever asking:

What kind of market am I actually trading in?

It doesn’t matter if you’re:

• Day trading

• Swing trading

• Position trading

• Trading momentum, growth, or scalping

If you’re not aligned with the bigger picture… you’re fighting the market.

And that’s a losing game.

This isn’t new.

Top prop firms start with the big picture every single day.

And in Market Wizards, traders like:

• Michael Marcus

• Bruce Kovner

• Richard Dennis

• Paul Tudor Jones

All studied Martin Zweig’s work to understand one thing:

The market environment.

Right now, the environment is changing.

We’ve gone from:

❌ Under key moving averages

❌ Poor breadth

❌ Defensive leadership

To:

✅ Price reclaiming key levels

✅ Breadth expanding

✅ Growth starting to lead again

Now the question is:

Is this the start of a new uptrend… or just another failed rally?

That’s exactly what I break down in this week’s Big Picture Market Pulse.

If you’re serious about trading, this is where you start.

With the market.

👉 https://tradingmomentum.substack.com/p/big-picture-market-pulse-april-12

It’s Confirmed. A Follow-Through Day.

NASDAQ-100 up nearly 3% today.

Higher volume than the previous session.

Price is now above key moving averages.