Just as Su Yi convinced several leaders of 'Huayin International' asset management institution to enter the market and short the GBP exchange rate, and helped to hold back a group of long institutions continuously squeezing shorts in the market.
Domestically, in various financial circles.
Previously, many retail investors, speculative funds, and various private equity institutions, who had rushed into the GBP exchange rate market to short after Su Yi's online call.
At this time, facing various market rumors about the imminent liquidation of 'Huayi Capital Chengyuan No. 1' main fund product, rumors about Su Yi being disoriented, and the continuously volatile and rising GBP exchange rate under the ongoing long squeeze, they were clearly finding it hard to hold on.
"Sigh, it's too difficult. The forex market is really not for humans. I'm losing so much my mind is exploding."
On a certain domestic online forex investment discussion platform, many investors participating in GBP exchange rate speculative trading sighed.
"The name 'Demon Pound' truly lives up to its reputation. It's too hard to grasp."
"The 1.5400 mark has been lost and regained several times. Looking at the market trend, the bullish offensive has not weakened. It's estimated that the GBP exchange rate will continue to surge."
"Sigh, following Mr. Su to short, losses have already exceeded 50% of the principal. What should we do now?"
"Mr. Su is indeed brilliant in the stock market. Whether it's his own operational performance or the performance of newly established private equity funds, they are all unique in the industry. But as for the forex market... I feel Mr. Su still can't quite grasp it!"
"In the long-short battles on the international financial market, Chinese capital institutions have never won. Sigh..."
"It looks like Mr. Su might be forced to cut losses and cover positions this round."
"The current situation is no longer as simple as cutting losses and covering positions. Once the main funds of 'Huayi Capital Chengyuan No. 1' managed by Mr. Su intend to withdraw, with his massive short positions being covered, the longs in the market will definitely accelerate the short squeeze on the GBP exchange rate, causing Mr. Su's losses to rapidly expand."
"I heard that the fund managed by Mr. Su has already lost over 300 million US dollars, 300 million US dollars..."
"Recently, there have been many rumors about Mr. Su in the market, some true, some false, making it hard to distinguish."
"I feel it's mostly true."
"Is Mr. Su destined to suffer a defeat in the GBP exchange rate market this time?"
"I don't think it's necessarily true. The logic Mr. Su previously presented for shorting the GBP exchange rate has not been disproven so far. I don't believe Mr. Su will be liquidated."
"What's there to be afraid of? In the past few trading days, all non-USD currency exchange rates have been falling. I don't believe the GBP exchange rate can go against the trend. I'm continuing to increase my short positions. This time... I must stand with Mr. Su."
"Anyway, I firmly believe in Mr. Su. His trading ability is definitely incomparable to those state-owned traders who were easily harvested by foreign institutions in the international financial market in the past.
Furthermore... Mr. Su holds hundreds of millions of US dollars and is openly shorting. If he isn't afraid with such a large amount of capital, why should I be? At worst, this time the account gets liquidated again to zero. It's not the first time it's happened anyway."
"I feel the likelihood of Mr. Su being liquidated is not high."
"The GBP exchange rate still faces significant pressure around the 1.5400 level."
"I don't believe the GBP exchange rate can decouple from the Euro's trend and strengthen on its own. The Euro exchange rate has fallen quite a bit recently, and hasn't the Fed already released hawkish remarks, saying that an interest rate hike cycle will start soon?"
"Exactly. If the Euro weakens, why should the Pound strengthen?"
"Haven't you heard that the Bank of England is conducting open market operations? With central bank intervention, it's not impossible for the GBP exchange rate to briefly climb above the 1.5500 mark, or even the 1.6000 mark."
"Sigh, the opposing side Mr. Su faces this time might very likely include the Bank of England."
"If the Bank of England stabilizes the exchange rate through continuous market operations, then it seems Mr. Su has little chance of exiting safely!"
"I wonder if everyone has noticed a problem. Currently, in the GBP exchange rate market, net long positions are so large, what is the driving force for the GBP exchange rate to continue rising?
You know... in the forex market, the purpose of many investors' trading is speculation. Many current longs in the market are holding profits. Once these people feel the upward pressure on the GBP exchange rate, they will definitely quickly realize their profits.
And the covering of these net long positions is equivalent to opening short positions in the market, which will also severely suppress the upward movement of the GBP exchange rate."
"According to what you're saying... the probability of the GBP exchange rate falling is still much greater than the probability of it rising?"
"Indeed. I think Mr. Su's persistence is not wrong. In the current GBP exchange rate market, the potential short strength is actually far greater than the long strength."
"Sigh, forget it, no need to analyze so much. I, for one, believe Mr. Su would never risk all his wealth without being absolutely certain."
"It wouldn't hurt to continue betting with small positions."
"Anyway, I'm following Mr. Su and continuing to increase my short positions."
"Even if I don't short, I can't go long at this time. I can't be on the opposing side of Mr. Su. Damn it... I've long disliked these arrogant foreign institutions. I hope Mr. Su can blow up their positions this time."
Accompanying numerous online discussions about Su Yi.
In some internal groups of speculative funds, such as the internal group of 'Foshan-based' speculative funds that previously followed Su Yi in shorting the GBP exchange rate.
Li Jinshi, who had intervened with some short positions in the GBP exchange rate, was clearly wavering in confidence at this moment.
He couldn't help but exclaim in the group,
"Sure enough, you can't just casually intervene in things you're unfamiliar with, unfamiliar fields. 50 lots of GBP short positions have cost me almost $250,000."
"That exaggerated?"
Chen Guiyun was startled.
"It seems the market rumors that the GBP short positions held by 'Huayi Capital Chengyuan No. 1' main fund product, managed by Mr. Su, have incurred total losses exceeding 300 million US dollars are not groundless."
"Calculated with 'Huayi Capital' holding at least 100,000 lots of short positions, a loss exceeding 300 million US dollars is entirely possible. It feels like this time... our Mr. Su will have to shed a layer of skin in the GBP exchange rate market, bleeding heavily from foreign institutions, before he can get out!"
Li Jinshi said.
"A loss of 300 million US dollars!"
Chen Guiyun sighed,
"Any institution would be severely damaged by that."
"It's probably not as simple as just being severely damaged,"
Liao Guoxiang responded at this moment.
"If 'Huayi Capital' completely fails in this battle in the GBP exchange rate market and exits with massive losses, judging by Mr. Su's recent frantic financing activities in the market... once he's liquidated, a debt crisis will instantly erupt.
It's foreseeable... 'Huayi Capital', this institution that was just praised as a god by many in the Modu financial circle, will directly face collapse and bankruptcy."
"That shouldn't happen, right?"
Li Jinshi said,
"Currently, 'Huayi Yuanzheng No. 1' fund is still operating normally, and its performance report disclosed last week still ranks first among similar fund products in the market. While Mr. Su's speculative behavior in the forex market is hard to evaluate, his stock investment ability, his insight into opportunities in the domestic stock market, and his ability to grasp the main trends are still top-notch in the industry. No one can deny this."
"No one denies his investment ability in the stock market. It's just that the dangers of the forex market are far more exaggerated than any of us imagined. Anyway, I don't see him getting out unscathed."
Liao Guoxiang said.
"Sigh... in this situation, it's basically impossible to get out unscathed. I guess 'Huayi Capital' is about to cut its losses, right? Damn it... I'm not holding on anymore either. I'll cut losses first."
Li Jinshi said.
Then, he immediately closed his 50 lots of short positions in the forex trading software.
And just as he reluctantly cut losses and closed positions.
At this moment, in the 'Modu Ultra-Short Gang' main speculative fund group.
Xu Qiao stared at his short positions, totaling hundreds of lots, and the significant floating loss figures in his account, feeling extremely conflicted.
"Lao Zhang, Lao Wu, Brother Chen... how much have you lost?"
Xu Qiao asked, tagging everyone in the group.
Lao Zhang replied,
"Almost $600,000. Sigh... a house in Modu is gone."
"I'm alright, I don't hold many short positions. Lost tens of thousands of dollars, just considered it supporting Brother Su."
Lao Wu responded.
Brother Chen replied,
"I've already cut my losses. I really don't understand the forex market very well, and my small position probably doesn't even count as negligible impact on Brother Su's holdings."
Xu Qiao sighed,
"Sigh... Forex trading seems simple, but it's extremely dangerous. These long institutions that are continuously squeezing shorts are truly crazy."
"As long as shorts don't die, longs won't stop. It feels like at this point, unless the massive short positions held by 'Huayi Capital Chengyuan No. 1' fund, managed by Brother Su, are liquidated, the longs won't give up."
Lao Wu said.
"Are our Chinese capital institutions really no match for these foreigners in the international financial market? It's really strange.
Lao Zhang said, clearly unconvinced.
Brother Chen's emotions were less volatile.
He replied,
"There's no way around it. Our capital size can't compare to theirs, and market pricing power is also in their hands. How can we compete when they set the rules? This time, Brother Su... is probably really going to have a hard time getting out unscathed."
"Forget about getting out unscathed. I've checked messages on foreign websites, and it seems everyone is waiting for 'Huayi Chengyuan No. 1' fund, managed by Brother Su, to be liquidated."
Lao Wu said.
"Will Brother Su really be liquidated?"
Xu Qiao asked.
"Hard to say. The current market situation has fully shifted towards the longs. Next... we can only hope for a miracle."
Brother Chen replied.
Just as he spoke...
The global trading market had entered the US trading session.
The GBP exchange rate, which had been fluctuating around the 1.5400 level for almost a day, began to break through the short-term consolidation platform and attack above the 1.5420 level, driven by strong market long power.
At the same time... as the date of the UK's Brexit referendum on June 23rd drew nearer.
Also, due to the increasing awareness of more and more funds experiencing extreme price fluctuations in the GBP exchange rate market.
As a result, more and more speculative funds and forex speculative traders began to accelerate their inflow into the GBP exchange rate market, causing the frequency and amplitude of GBP exchange rate fluctuations to become increasingly violent, and also leading to a further sharp increase in the number of open long and short positions in the market.
However, no matter how the short-term intraday trend of the GBP exchange rate changed.
It did not deter Su Yi's firm resolve to short the GBP exchange rate.
On the following day, June 15th, when the GBP exchange rate refreshed its recent high, breaking above the 1.5440 level, Su Yi further increased the short positions of 'Huayi Chengyuan No. 1' main fund product to 160,000 lots, just 10,000 lots short of his planned 170,000 lots.
"One more week..."
Su Yi stood in the trading room, staring at the rapidly changing GBP exchange rate trend on the large screen, his eyes sharp.
He quietly calculated the time and instructed Qu Zecai:
"Manager Qu, for every 20-point upward breakthrough in the GBP exchange rate, increase the short position by 5,000 lots, continuing until the GBP exchange rate trend reverses."
Qu Zecai responded,
"A grid adding position strategy of 20 points? Mr. Su, wouldn't that be too frequent?"
Su Yi smiled and said,
"It won't be too frequent. Just operate according to this strategy. If nothing unexpected happens... the area near the 1.5500 mark will be the final retreat point for the longs in the market."
"Alright,"
Qu Zecai replied.
He didn't understand how Su Yi made his judgments, but given the current situation, he could only choose to trust Su Yi.
And just as Qu Zecai responded to Su Yi, deciding to execute the plan, Su Yi's phone rang.
Su Yi took out his phone, glanced at it, and answered with a smile.
The voice of Zhang Yanshun, General Manager of Asset Management Business at 'Huayin International' Institution, came through the receiver.
He heard the other party smiling and saying,
"After my application to the leaders, they have decided to grant our institution autonomy in forex market investments."
Su Yi said excitedly.
"Great. Thank you, Mr. Zhang, for your strong support."
Zhang Yanshun chuckled,
"Mr. Su, you can directly liaise with Xiao Kong and Xiao Meng from now on."
With that, he sent the mobile numbers of his two capable subordinates to Su Yi via text message.
Su Yi contacted the other party using the information they sent him.
Then, he spent over an hour having the company's network technology department establish instant network communication between the two institutions, making it convenient for both to launch coordinated attacks in real-time, down to the second, during trading.
(End of Chapter)