Rebirth of the Capital Legend

Chapter 284 The battle between bulls and bears becomes increasingly fierce!

Su Yi stared at the pound exchange rate that had fallen back below 1.5300 points, as well as the rapidly increasing trading volume and the rapidly increasing open short positions in the market. There was obvious surprise in his eyes, and he felt very surprised.

Originally, he thought...

Under the influence of market news and sentiment.

Especially when there are market rumors that the Bank of England is increasing its intervention in the pound exchange market and the preliminary vote count has already locked in the outcome of continuing to stay in the EU.

The pound sterling exchange rate will be squeezed out by the main bullish institutional groups in the market.

If it breaks through 1.5400, it may even test the last psychological defense pressure of the bears at 1.5500.

Unexpectedly, when the pound exchange rate just touched around 1.5350, it encountered a very large counterattack from the main short orders and quickly fell back below 1.5300 points.

"Fuck, the number of short orders just now must be more than 10, right?"

While Su Yi was surprised, Meng Shengfei, who was working at the Huayin International Investment Department II Trading Center, which was linked to Huayi Capital, the institution headed by Su Yi, was also overwhelmed with emotion. He stared at the trend of the pound exchange rate with his eyes, and was obviously surprised. He exclaimed: "Such a big move, it looks like a major institution has entered the market!"

"There's no unusual news in the market, what's going on?" Kong Fansheng, manager of Huayin International's investment department, was also puzzled and asked in surprise, "Such a large-scale short order was placed right away. Logically speaking... the market was so decisive, so they must have received some inside information, right?"

"If I'm not mistaken, the move just now... should be by European capital." Frederick, who was in the main hedge fund trading room of Aberdeen Asset Evolution No. 1 and was also connected to Huayi Capital and Huayin International via instant messaging, responded, "After all, whether it's Goldman Sachs, BNY Mellon, Citigroup, or Blackstone... the main time for trading is generally during the US trading hours. Usually these institutions will not trade with the main long institutions in this way during the European trading hours, especially when the longs have an absolute advantage on the market."

"European capital?" Meng Shengfei pondered for a moment and asked, "The funds that can be mobilized to make such a large-scale move in an instant must be at least tens of billions of US dollars. In other words, this kind of trading move can only be done by the top large institutions in European capital. However, the number of top large institutions in European capital is very limited. Which one could it be? Barclays Bank? BNP Paribas Investment Bank? It can't be UBS, Pacific Capital, or Huifeng Bank, right?"

"We'll know who it is later." Su Yi smiled and responded, "The market is not impenetrable. It's hard to hide such a large-scale short sale."

"It feels like British local capital." Kong Fansheng said after thinking carefully for a while, "And this fund suddenly shorted so heavily, it must have received some very clear information from its information channels, so it was eager to carry out large-scale position building operations in this way."

"I think so too." Frederick nodded slightly.

"What kind of news will have an impact?" Meng Shengfei asked puzzledly.

Frederick thought about it but had no idea, so he immediately looked at Adrian, the assistant fund manager who was responsible for market information collection and intelligence information business.

Adrian noticed the look in Frederick's eyes.

He quickly picked up the phone and called the company's market intelligence department and market information department.

However, the responses received from the main heads of the two departments were that there were no obvious changes in market news.

"No unusual news?" After noticing the change in Adrian's expression, Frederick asked with a smile, "How is that possible? Then do you know who this institution is that suddenly shorted the market?"

Adrian called the market intelligence department and the market news department, and the heads of the two departments responded: "The order was traded directly from the London Stock Exchange, which is a dedicated investment seat in the market. There are only a few European and British investment institutions that have this dedicated investment seat and are qualified as market makers, such as 'Huifeng Investment Bank', 'Bank of England', 'Pacific Capital', and 'Barclays Investment Bank'."

"Huifeng, Bank of England, Pacific Capital...are the absolute main long positions in the market." Frederick continued to ponder for a while, and then said, "What is the current attitude of Barclays Investment Bank towards the pound exchange rate market? Does it still have a large long position?"

Adrian replied: "As far as I know, some time ago, many of the main fund products under Barclays Investment Bank had already withdrawn from the long position of the pound. Among the main institutional holdings disclosed by the market, Barclays Investment Bank is not among the institutions with the highest long positions."

“Could it be this old British institution?” Frederick guessed.

"It's possible." After hearing Frederick's guess, Su Yi pondered for a while and said, "The investment ideas of this institution have always been relatively rational, and the recent investment analysis report on the pound exchange rate also warned of risks, believing that the pound exchange rate has the risk of extreme decline."

"Hehe..." Meng Shengfei responded at the right time, "If it is true that Barclays Investment Bank has turned from long to short, then this battle between long and short positions will be really interesting."

"If it is really Barclays Investment Bank..." Kong Fansheng thought for a moment and said, "I'm afraid the reason why they made the long-to-short investment strategy is not only the risk issues mentioned in their previous investment analysis report, but there must be other important reasons. It's just that we don't know these important reasons at the moment."

"It doesn't matter. If you don't know the reason, then you don't know it." Meng Shengfei said, "As long as there are large institutions that turn from long to short, as long as the pound exchange rate trend is adjusted downward, as long as we can suppress the bullish arrogance on the market, causing the speculative bulls in the market to believe that the pound exchange rate trend has not deviated from the oscillation range, and thus guide this part of the speculative funds to cover, then for us... it is a good thing."

They are the main short-selling institutions in the market.

No matter from which aspect we analyze it, we naturally hope that the short-selling force in the market, especially the main short-selling force, is as strong as possible.

Because only in this way can their financial pressure be alleviated.

This can avoid the situation where the main long institutions in the market are forced to short sell before the referendum day on the 23rd and are forced to cover their positions.

And just as several people predicted...

At this time in London, Barclays Investment Bank's 'Lion International' hedge fund trading department.

As the fund manager of this main fund product, Claude has indeed made the decision to re-enter the market and short the pound exchange rate after weighing the pros and cons for a long time.

And that huge short order just now was indeed his work.

"Old friend, isn't your decision a bit hasty?" Alex, the head of the market research department who had been silent beside Claude, hesitated for a while and asked, "When many domestic institutions are called by the central bank to go long and maintain the stability of the pound exchange rate, it feels a bit inappropriate for us to short the exchange rate on a large scale."

Claude chuckled and said, "Do you think the plan formulated by the central bank to snipe short-selling capital has a chance of success? Do you think that the Wall Street capital that is more ferocious than wolves is really that easy to harvest and will really be the lambs to be slaughtered in the market?" "Of course I don't think so." Alex said, "I just think that the current situation is still within the controllable range, and the government is still under control of the impact of the referendum results on the 23rd."

"It won't be that easy," Claude said. "I carefully reviewed the cabinet's recent motion of 'Brexit referendum' and found that there is a lot going on. Many members of the cabinet agree with Salmond, and many of them... actually hope that Salmond will make a scene."

"Impossible?" Alex said subconsciously.

"That's not all." Claude said, "Just this morning, I heard that several people in the city government are related to Sadmon, and these areas are all places that everyone expects to agree to continue to stay in the EU, plus Wall Street capital is secretly messing around.

I always feel that there will be unexpected situations in this referendum.

Moreover, the market's bullish expectations are now too consistent. If there is a stampede of covering of millions of net long positions, the consequences will be disastrous. "

"We can short our own country..." Alex said, "If we go in the wrong direction, we will face great pressure from public opinion, and this will have a very adverse impact on the subsequent business development of our organization. What's more, if the pound sterling exchange rate falls or an extreme collapse occurs, it will be a big blow to our organization's currency reserves, foreign exchange business, etc."

Claude said, "I am not responsible for other business directions, and I cannot take care of so many of them. Now that I am the fund manager of the main fund product of 'Lian International', I have to be responsible for this fund product. There is no reason to trade in the wrong direction."

"Okay!" Alex thought about it and sighed softly.

He knew that Claude was a very stubborn person and once he made an investment decision, he would not change it.

What's more, after thinking about it carefully, he felt that the plan proposed by the central bank to snipe short-selling capital was not very reliable. In addition, everyone thought that the result of the referendum on the 23rd would definitely be to continue to stay in the EU, which made him feel a little uneasy.

However, 'Barclays Investment Bank' turned from bullish to bearish.

In the absence of fundamental changes in market news and the general expectations of global investors that they are still biased towards the bullish direction, it has not been able to continue to suppress the bullish momentum on the market, nor has it crushed the bullish confidence.

After the main fund 'Barclays Investment Bank Lion International' invested huge amounts of money and established a large number of short positions, the pound exchange rate briefly fluctuated below the 1.5300 mark, and then re-surmounted the 1.5300 mark, and in the late European trading session, it once again refreshed the intraday high to 1.5360 points.

And, the bulls once again launched a vigorous counterattack.

When the time entered the early stage of the U.S. trading session, the bulls took advantage of the magnificent short squeeze momentum and even pushed the pound exchange rate to the intraday high of 1.5384 points.

Then, when the pound exchange rate approached the 1.5400 mark.

After further comprehensive analysis of market news, sentiment and funding, a group of major short-selling capitals on Wall Street made a decisive decision to continue increasing their short positions in an effort to curb the momentum of the pound sterling exchange rate to break above the 1.5400 mark. They used huge funds and short positions to suppress the pound sterling exchange rate back to around 1.5300 points.

“Why is it so difficult to break through the 1.5400 level?”

Noting the trend of the pound exchange rate, which fell again, some retail investors in the market who were long near the 1.5350 point couldn't help but complain.

"The stimulus from the news is still not enough to cause the confidence of the main bears to collapse."

"Not to mention causing the confidence of the main short sellers to collapse, they can't even put psychological pressure on the main short sellers in the market."

"If the 1.5400 level cannot be broken, it seems that the pound exchange rate will fall again and touch the platform support level of 1.5200 or even 1.5100."

“To put it bluntly, the trend of the pound exchange rate, although becoming more and more intense, is still in a large shock platform.”

"That's for sure. The short positions held by the main institutions in the market have not decreased significantly. Under this circumstance, it is basically impossible for the pound exchange rate to break upward unilaterally."

"Many intraday speculative positions in the market are already being quickly covered."

"Yes, long positions are decreasing rapidly, and the number of new short positions has begun to exceed the number of new long positions, which shows that many long intraday positions in the market are being closed."

"If you don't close your positions in a volatile market, your profits will be lost."

"Why are there so many bearish people among these big institutions on Wall Street?"

"Wall Street capital is a big short in the foreign exchange market. This is nothing strange. Wasn't the continuous decline of the British pound exchange rate in the past two years also led by these big institutional funds?"

"In the past few days, the market has been falling during the Asian and US trading hours, but rising during the European trading hours. It's really weird."

"The fluctuation range of the pound exchange rate is getting larger and larger. Does this mean that the struggle between the long and short forces in the market is becoming more and more intense?"

Accompanied by discussions among countless retail investors on major foreign exchange investment and speculation exchange platforms in the market.

As the US trading session continues.

The pound sterling exchange rate continued to fall due to the closing of long positions during the day and the increase of short positions by Wall Street capital.

Finally, when the market reaches the closing moment of the US trading session.

The pound sterling exchange rate almost erased all of its intraday gains and fell back to around 1.5200.

(End of this chapter)