Twelve days into 2026, I’m reassessing my trading approach.

2025 was a very healthy momentum market. Speculation ran wild, and nearly every theme worked at some point. That environment ended abruptly in November.

Around that time, the market began to shift.

Investors started to come to terms with the idea that the MAG7, and Nvidia in particular, may have already priced in much of their upside. Nvidia topped out around $212 and began hovering closer to $180. That marked the beginning of a tougher tape.

I was short Nvidia with the view that there simply wasn’t much upside left and that profit taking would start to matter. The trade worked reasonably well. But what stood out wasn’t just that trade. It was what happened afterward.

Momentum stopped working almost overnight.

Small cap speculation dried up. The same theme driven names that were ripping higher earlier in the year stopped following through. Even when momentum appeared, like in gold and silver, it wasn’t clean or reliable. Momentum strategies across the board began to fail.

November and December were humbling. The first days of 2026 did not improve things either.

That is usually a sign the market environment has changed.

What Works in Dull Markets

When momentum disappears and speculation fades, one thing tends to work better than anything else. Owning real, healthy companies.

By healthy, I mean companies with real revenue, recurring business models, large and sticky user bases, strong balance sheets, and plenty of cash with minimal debt.

Cash matters more than almost anything else right now. I want to know whether a company can weather a downturn, whether it is self sufficient, and whether it avoided overspending during the growth at all costs environment of 2025.

What I’m Looking For Now

Going into the rest of 2026, my focus has shifted toward companies that check a few specific boxes:

• Market cap above roughly $300 million
• Down 30 percent or more over the last year
• Still growing revenue, even if growth has slowed
• Strong cash position
• Minimal debt
• Healthy trading volume, ideally over three million shares on average

When you combine those factors, you get something that offers comfort in uncertain markets.

Many of these companies have already taken their beating. They are no longer priced for perfection. Because they are well capitalized, they have options. They can reinvest in the business, survive multiple tough years, or become acquisition targets. In some cases, their enterprise value is even below their market cap.

That is a very different risk profile than speculative momentum names that rely on constant capital inflows.

The Bigger Shift

This does not mean momentum trading is dead forever. Markets rotate and environments change.

But for now, my mindset for 2026 is clear. Less overnight momentum trading. More focus on durable, cash rich companies. More emphasis on balance sheets and real businesses.

In slower, less opportunistic markets, survival and staying power matter far more than chasing the next theme.

That is where my head is at in 2026.