diff --git a/Core/CategoryManager.lua b/Core/CategoryManager.lua
index 49bf35f..ead4426 100644
--- a/Core/CategoryManager.lua
+++ b/Core/CategoryManager.lua
@@ -329,6 +329,25 @@ function CategoryManager:MigrateCategories()
         boeCat.priority = 75
         addon:Debug("CategoryManager: Migrated BoE priority to 75")
     end
+
+    -- Migrate Junk category to ensure proper rules and priority
+    local junkCat = cats.definitions["Junk"]
+    if junkCat and junkCat.isBuiltIn then
+        local needsUpdate = false
+        -- Check if priority is too low
+        if not junkCat.priority or junkCat.priority < 85 then
+            junkCat.priority = 85
+            needsUpdate = true
+        end
+        -- Check if rules are missing or wrong
+        if not junkCat.rules or table.getn(junkCat.rules) == 0 then
+            junkCat.rules = { { type = "quality", value = 0 } }
+            needsUpdate = true
+        end
+        if needsUpdate then
+            addon:Debug("CategoryManager: Migrated Junk category")
+        end
+    end
 end
 
 -- Get all categories
@@ -497,6 +516,17 @@ function CategoryManager:EvaluateRule(rule, itemData, bagID, slotID, isOtherChar
         return string.find(itemName, ruleValue) ~= nil
 
     elseif ruleType == "quality" then
+        -- For quality 0 (gray/junk), also check tooltip as fallback
+        if ruleValue == 0 then
+            if itemData.quality == 0 then
+                return true
+            end
+            -- Tooltip fallback for gray detection (current character only)
+            if not isOtherChar and addon.Modules.Utils and addon.Modules.Utils.IsItemGrayTooltip then
+                return addon.Modules.Utils:IsItemGrayTooltip(bagID, slotID, itemData.link)
+            end
+            return false
+        end
         return itemData.quality == ruleValue
 
     elseif ruleType == "qualityMin" then
diff --git a/UI/SettingsPopup.lua b/UI/SettingsPopup.lua
index 1329e93..14831f7 100644
--- a/UI/SettingsPopup.lua
+++ b/UI/SettingsPopup.lua
@@ -1375,10 +1375,50 @@ function Guda_SettingsPopup_CategoriesTab_Update()
         end
     end
 
-    -- Set reset button text
+    -- Set button texts
+    local addBtn = getglobal("Guda_SettingsPopup_AddCategoryButton")
+    if addBtn then
+        addBtn:SetText("+ Add Category")
+    end
+
     local resetBtn = getglobal("Guda_SettingsPopup_ResetCategoriesButton")
     if resetBtn then
-        resetBtn:SetText("Reset to Defaults")
+        resetBtn:SetText("Reset Defaults")
+    end
+end
+
+-- Add new custom category
+function Guda_SettingsPopup_AddCategory_OnClick()
+    if not Guda.Modules.CategoryManager then return end
+
+    -- Generate unique ID
+    local baseId = "Custom"
+    local counter = 1
+    local newId = baseId .. counter
+
+    local cats = Guda.Modules.CategoryManager:GetCategories()
+    while cats.definitions[newId] do
+        counter = counter + 1
+        newId = baseId .. counter
+    end
+
+    -- Create new category definition
+    local newDef = {
+        name = "New Category " .. counter,
+        icon = "Interface\\Icons\\INV_Misc_QuestionMark",
+        rules = {},
+        matchMode = "any",
+        priority = 50,
+        enabled = true,
+        isBuiltIn = false,
+    }
+
+    -- Add to database
+    if Guda.Modules.CategoryManager:AddCategory(newId, newDef) then
+        -- Update display
+        Guda_SettingsPopup_CategoriesTab_Update()
+        -- Open editor for the new category
+        Guda_CategoryEditor_Open(newId)
     end
 end
 
diff --git a/UI/SettingsPopup.xml b/UI/SettingsPopup.xml
index 3dd7e30..84af32c 100644
--- a/UI/SettingsPopup.xml
+++ b/UI/SettingsPopup.xml
@@ -692,10 +692,10 @@
                         </Anchors>
                     </Frame>
 
-                    <!-- Reset to Defaults Button -->
-                    <Button name="Guda_SettingsPopup_ResetCategoriesButton" inherits="UIPanelButtonTemplate">
+                    <!-- Add Category Button -->
+                    <Button name="Guda_SettingsPopup_AddCategoryButton" inherits="UIPanelButtonTemplate">
                         <Size>
-                            <AbsDimension x="140" y="25"/>
+                            <AbsDimension x="120" y="25"/>
                         </Size>
                         <Anchors>
                             <Anchor point="BOTTOMLEFT" relativeTo="$parent" relativePoint="BOTTOMLEFT">
@@ -704,16 +704,30 @@
                                 </Offset>
                             </Anchor>
                         </Anchors>
+                        <Scripts>
+                            <OnClick>
+                                Guda_SettingsPopup_AddCategory_OnClick()
+                            </OnClick>
+                        </Scripts>
+                    </Button>
+
+                    <!-- Reset to Defaults Button -->
+                    <Button name="Guda_SettingsPopup_ResetCategoriesButton" inherits="UIPanelButtonTemplate">
+                        <Size>
+                            <AbsDimension x="120" y="25"/>
+                        </Size>
+                        <Anchors>
+                            <Anchor point="LEFT" relativeTo="Guda_SettingsPopup_AddCategoryButton" relativePoint="RIGHT">
+                                <Offset>
+                                    <AbsDimension x="10" y="0"/>
+                                </Offset>
+                            </Anchor>
+                        </Anchors>
                         <Scripts>
                             <OnClick>
                                 Guda_SettingsPopup_ResetCategories_OnClick()
                             </OnClick>
                         </Scripts>
-                        <NormalText>
-                            <Anchors>
-                                <Anchor point="CENTER"/>
-                            </Anchors>
-                        </NormalText>
                     </Button>
                 </Frames>
             </Frame>