The Three Primacies

Where this fits. The pre-market filter stack codified directly inside TradingHQ. These three gates run in the pipeline, before any chart pattern matching, and decide which names even reach the screener. They're the system, not a discretionary call at the keyboard.

Overview

Every entry concept in the playbook — wedge pop, EMA crossback, base 'n break — assumes three preconditions are met. If they're not, the entries don't work. If they are, the entries work with high reliability.

The three preconditions are filters that run before the entry decision. They're not part of the chart read; they're gates that decide whether a chart read is even worth attempting. I run them in order: trend, leadership, regime. A name has to pass all three to be in the playable universe.

These aren't refinements to swing trading. They're the foundation of it. Get them wrong and the rest of the system doesn't matter.

Primacy 1: Trend first

A stock has to be in a structural state where a long entry is mathematically defensible. There are two states that qualify, and one set of states that doesn't.

Stage 2 — the default qualifying state. Price above the 30-week MA, 30-week MA sloping upward, recent weekly closes confirming the trend is established. This is the state that the momentum playbook lives in: base 'n breaks, EMA crossbacks, continuation entries. Earliest Stage 2 is preferred — the move has just started, the bulk of the run is still ahead.

Late Stage 4 with confirmed bottoming — the reversal qualifying state. A name that's been in Stage 4 for weeks or months but has now printed a higher swing low, reclaimed the 50-day MA on heavy volume, and shown relative strength turning positive against SPY is a valid long candidate before it reaches Stage 2. This is the bridge: pre-trend reversal entries taken when the structure says the downtrend is done but the new uptrend isn't yet visible on the higher moving averages. The 4B-Minus setup lives here.

What's off-limits:

• Stage 3 — topping pattern, MAs flattening, distribution on volume. Not a setup; an exit signal.
• Mid-Stage 4 with no bottoming signature — price falling through MAs on accelerating volume, no higher low yet, RS still negative. Oversold isn't a reason; bottoming evidence is. The evidence has to be visible on the chart before the entry, not implied from "it looks washed out."

This single filter eliminates more bad trades than every other rule combined. Most losing trades I've seen — mine included — were taken on stocks in the wrong structural state. The chart looked like it might be turning, the read seemed promising, the setup was technically valid. The stock was mid-Stage-4 with no real bottom yet, or late Stage 3 with distribution that hadn't fully shown up.

If you only adopt one rule from this entire concept library, adopt this one. Long entries only on names whose structure permits them: Stage 2 for momentum setups, late Stage 4 with confirmed bottom for reversal setups. Everything else waits.

Primacy 2: Leadership first

A trending stock is necessary but not sufficient. The stock also needs to be a leader within a leading group. Two filters:

Industry strength. The industry group's 1-month relative strength rank is in the top 20 of all groups. Not the bottom 50. Top 20. Strong industries lead, weak ones lag, and individual names in weak groups underperform even when they look strong on a standalone chart.

The stock leads the group. Within a strong group, take the strongest names — typically the top three by 1-month RS within the group. Buying a follower in a strong group means you're paying for the group's momentum but getting a name that lags it. The math doesn't work.

The combined filter — strong group, strongest name in the group — is what produces the trades that go 8R, 15R, 25R. It's not about finding "good charts." It's about finding the right name in the right group at the right time.

The codification: industry_rank_1m ≤ 20 AND group health is not deteriorating (downgrade in the last week). Both have to be true.

Primacy 3: Regime first

A leading stock in a strong group still won't work in a hostile market regime. This is the filter that's most often skipped — traders are willing to override the regime because the chart looks good. They lose.

The regime is the broader market's character. I use a composite score (CMRF) that combines several breadth and trend signals into a single classification:

• GREEN+. Active thrust regime. Press, full size, expect breakouts to extend.
• GREEN. Constructive. Normal sizing, normal hit rates.
• YELLOW. Caution. Reduce size, gate new entries to A+ setups only.
• YELLOW-RED. Deteriorating. Defensive. Mostly cash.
• RED. Hostile. No new long entries.

In GREEN+ and GREEN, base 'n breaks hit at ~65%. In YELLOW, they hit at ~50%. In RED, they hit at maybe 30%. The pattern doesn't change — but the market's willingness to follow through on the pattern does.

The regime check happens before any chart read. If the regime is RED, I don't open the screener for new entries — I manage existing positions and watch. If it's YELLOW, I run the screener but filter much harder. If it's GREEN+, I take everything that passes the other two primacies at full size.

Why these run in order

Trend → Leadership → Regime is a deliberate sequence:

1. Trend is the cheapest filter — one weekly chart read. Apply it first; it eliminates 70% of the universe.
2. Leadership requires industry-level data and ranking, slightly more work. Apply it second.
3. Regime requires composite breadth analysis, the most expensive filter. Apply it last to confirm the broader context.

If a name fails any of the three, the deeper analysis (chart pattern, entry timing, stop placement) is wasted. The primacies are designed to stop the analysis early.

Where this fails

Two situations where I'll override:

• Bottoming markets. When the regime is just turning from RED to YELLOW, the very first names to break out are not "leaders by 1-month RS" — they're stocks that bottomed early and started moving before the index did. In this narrow window (maybe two weeks per cycle), I'll relax the leadership filter slightly.
• Sector rotations. When a sector that was weak for months suddenly inflects (Energy 2022, Banks 2023), the 1-month RS metric lags reality by a week or two. I'll occasionally take a name in a group that's still ranked outside the top 20 if the inflection is visible on the group's weekly chart.

Both overrides are tactical exceptions, not principled deviations. The default is the rule.

Use

Before any chart read, run three checks: Is the stock in Stage 2? Is it leading a leading group? Is the market regime constructive? Three yes-no questions. If any answer is no, the rest of the analysis doesn't happen.

Most traders skip this and go straight to the chart. That's why most traders underperform their setup edge — they have valid patterns, but they're applied to invalid universes.