The âWall Street Wizardâ who made hundreds of millions.
Top 12 technical trading rules she follows đ§ľđ
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âĄď¸Donât miss your next Analysis! Who's Linda Raschke?
Linda Raschke is a well-known trader who started learning about financial markets from her father. She grew up in a trading family and became interested in charts at a young age.
She began her career as a commodities trader on the Pacific Stock Exchange and later became a registered adviser. Raschke is a strong believer in technical analysis and connects her ability to recognize patterns to her love of music.
She thinks traders donât need a deep market background because the rules change when big investors get involved. She shares her knowledge about short-term trading patterns through books, blogs, and YouTube videos. Preparation is the most important thing for Raschke. She carefully plans all her ideas, trades, and positions, and she almost never breaks her rules.
Lindaâs hedge fund (LBR Group) was ranked 17th out of 4500 for best 5-year performance by BarclaysHedge. She continues to trade daily to this day from the same money-managed program she has been trading since 1992. Here are her top 12 technical trading rules you need to knowđ
1. Buy the first pullback after a new high. Sell the first rally after a new low.
2. Afternoon strength or weakness should have follow through the next day. 3. The best trading reversals occur in the morning, not the afternoon. 4. The larger the market gaps, the greater the odds of continuation and a trend. 5. The way the market trades around the previous dayâs high or low is a good indicator of the marketâs technical strength or weakness. 6. The previous dayâs high and low are two very important âpivotâ points, for this was the definitive point where buyers or sellers came in the day before. Look for the market to either test and reverse off these points, or push through and show signs of continuation. 7. The last hour often tells the truth about how strong a trend truly is. âSmartâ money shows their hand in the last hour, continuing to mark positions in their favor. As long as a market is having consecutive strong closes, look for up-trend to continue. The up trend is most likely to end when there is a morning rally first, followed by a weak close. 8. High volume on the close implies continuity the next morning in the direction of the last half-hour. In a strongly trending market, look for resumption of the trend in the last hour. We put a lot of research and work into this thread for FREE before reading itđ đ¨
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Investors lost $40 billion in just one day. Hereâs the untold story of what happened
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--- 1 / The Terra (LUNA) collapse stands as one of the biggest disasters in crypto history. Once a top project with billions in market value, Terra's downfall sent shockwaves across the industry, wiping out fortunes and shattering trust. In this thread, Iâll break down how Terraâs ambitious algorithmic stablecoin model failed, the events that led to its collapse, and the critical lessons every crypto investor should learn from this fiasco. Letâs dive into the story of Terra (LUNA) and its dramatic fall --- 2 / Terra was a blockchain project that aimed to revolutionize payments with its algorithmic stablecoin, UST. Unlike traditional stablecoins backed by reserves like USDT or USDC, UST was designed to maintain its $1 peg through a complex relationship with Terraâs native token, LUNA. --- 3 / The idea was simple: users could always exchange 1 UST for $1 worth of LUNA, and vice versa, with LUNA being burned to mint UST and stabilize its price. But as we would soon see, the algorithmic model had critical vulnerabilities: when stress hit the system, the very mechanism meant to stabilize UST would turn into a death spiral.
--- 4 / In May 2022, UST began to lose its $1 peg after significant withdrawals from Anchor, a DeFi platform that was crucial to Terraâs ecosystem. Anchor offered a high annual yield of nearly 20% on UST deposits, attracting a huge portion of USTâover 70% of the total supply.
--- 5 / When concerns about sustainability arose, users rushed to withdraw their funds, creating sudden selling pressure on UST. As UST's value dipped below $1, the mechanism to restore the peg involved minting more LUNA, but this only flooded the market and crashed LUNAâs price. --- 6 / The crisis accelerated rapidly. UST lost its $1 peg entirely, dropping to as low as $0.10. Meanwhile, LUNA's supply soared from around 350 million tokens to over 6.5 trillion in a desperate attempt to restore UST's value. This caused LUNAâs price to plummet from over $80 to nearly $0.0001 within days. Major exchanges began delisting LUNA and UST due to their extreme volatility, and Terraâs market cap, which had been around $40 billion, evaporated almost overnight.
--- 7 / As the Terra collapse unfolded, all eyes turned to Do Kwon, the projectâs outspoken founder. Known for his confidence and bold claims, Do Kwon had been a vocal advocate for Terraâs success, often dismissing critics. But as UST and LUNA crashed, his tone shifted from defiance to damage control. The team scrambled to restore USTâs peg, implementing emergency measures like minting trillions of LUNA and using billions in Bitcoin reserves to try and stabilize the situation. However, these efforts were too little, too late, and the downward spiral continued.
--- 8 / Do Kwon announced plans for a "recovery" by proposing to fork the Terra blockchain and launch a new LUNA token, but confidence in the project had already been shattered. The community was divided, and many investors felt betrayed. Lawsuits and investigations into Terraâs collapse soon followed, with Do Kwon facing growing legal scrutiny and calls for accountability.
--- 9 / Controversy grew as it emerged that, despite his earlier denial on Twitter, Do Kwon did control the burning wallet and had access to the keys. His involvement in managing LUNAâs supply played a crucial role in the ecosystem's collapse.
--- 10 / The Terra collapse caught regulators' attention worldwide, sparking concerns about investor protection and leading to calls for stricter crypto regulations. Authorities began scrutinizing algorithmic stablecoins and DeFi projects, with some countries launching investigations into Terra for potential fraud and market manipulation. Lawsuits against Terra, Do Kwon, and others quickly followed. South Korean prosecutors issued an arrest warrant for Do Kwon, making him a key figure in the legal fallout. --- 11 / After months on the run and facing multiple legal challenges, Do Kwon was finally detained in March 2023. Authorities caught up with him in Montenegro, where he was found using a forged passport. His detention marked a significant turn in the fallout from the Terra collapse, as international authorities, including South Korea and the United States, had been actively pursuing him for his role in the disaster. The arrest intensified the scrutiny on Kwon, with legal proceedings focusing on allegations of fraud, market manipulation, and misleading investors.
--- 12 / The Terra collapse exposed the risks of algorithmic stablecoins and high-yield DeFi projects. It showed how quickly things can fall apart when stability is uncertain. The key takeaway: always understand the risks before investing in crypto. In such a volatile space, even major projects can collapse. Be cautious, never invest more than you can afford to lose, and always do your research. We put a lot of research and work FOR FREE into this thread before reading it.
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