Jun 9, 2017 03:48 PM

Wonder Trader: Linda Bradford Raschke

Dear Traders,

According to the latest researches, there is a new force coming into the professional traders’ territory. More and more women start to learn investing techniques and develop new strategies on their own. And it really seems quite logical, since historically women tend to assess risks more thoroughly and avoid reckless tactics, which makes them perfect risk managers and extremely talented traders.

Among the most prominent women in the trading world, Linda Raschke is certainly one of the best ones. In 1981 (at the age of 22) her trading career of a  market maker in equity options has started. Firstly it was the Pacific Coast Stock Exchange (founded back in 1956) and later on, she decided to move to Philadelphia Stock Exchange. Since 2002 Linda is managing her own hedge fund.

Through her 35-years trading career, Linda Raschke gained an unrivalled trading experience, which she is always happy to share with the others in her lectures, radio and TV programs and books:

  1. Buy the first pullback after a new high. Sell the first rally after a new low.

  2. Afternoon strength or weakness should 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 day’s high or low is a good indicator of the market’s technical strength or weakness.

  6. The last hour often tells the truth about how strong a trend truly is. “Smart” money shows their hand in the last hour, continuing to mark positions in their favour.

  7. High volume on the close implies continuation the next morning in the direction of the last half-hour. In a strongly trending market, look for a resumption of the trend in the last hour.

  8. The first hour’s range establishes the framework for the rest of the trading day.

  9. Trade aggressively if there are early signs of a strong trend for the day.

  10. There are four basic principles of price behaviour: a) a Trend Has a Higher Probability of Continuation than Reversal; b) Momentum Precedes Price; c) Trends End in a Climax; d) The Market Alternates between Range Expansion and Range Contraction.

As Linda often says, the world of money is shaped by human behaviour, where nobody has the foggiest notion of what will happen in the future. The successful trader does not base his moves on what supposedly will happen but reacts instead to what does happen. 
Don't be afraid to act on your own. The market always greets the new talents! 

Sincerely yours,

Ayrex Team.