Rebirth of the Capital Legend

"President, we must immediately increase the release of foreign exchange reserves into the market!"

At 5:30 p.m. Yanjing time, inside the Bank of England, at an emergency committee meeting, committee member Clement anxiously advised Bank of England Governor Brian.

"Indeed, the current situation is more serious than we expected." Another committee member, Horace, also said at this time, "The capital on Wall Street is really a bloodthirsty wolf pack. This group of guys has been selling pounds in various trading markets, deliberately creating panic selling of pounds by global financial institutions, multinational trading companies, and even individual investors, and disguised runs on the pound, causing major global foreign exchange-related banking institutions to begin to restrict foreign exchange business related to the pound.

In this situation, if we leave it alone and do not immediately increase the release of foreign exchange reserves.

I am afraid that a more serious pound run will occur.

By then, with the addition of this group of Wall Street capitals fanning the flames, the consequences will be even more disastrous.

At the same time, the accumulation of long and short positions in the pound exchange rate trading market is also very large. Once the pound encounters a more serious run and sell-off in the global trading market, the trend fluctuations in the pound exchange rate trading market will also be extreme. Once this happens.

It will be very difficult for us to recover from this decline.”

After hearing what the two said, Brian looked around at the other committee members and asked, "What do others think?"

The other committee members looked at each other, thought for a while, and then raised their hands to agree with Clement and Horace.

Brian nodded when he saw that everyone had reached a consensus.

Immediately afterwards, he instructed the foreign exchange management department of the central bank to further release US dollar foreign exchange reserves into the market and to recover the large amount of British pound currency sold in the market.

"Good news, the Bank of England is finally making stronger market interventions."

Just as the Bank of England increased the release of foreign exchange reserves to the market and further increased its long positions in the pound trading market, the relevant news also spread to the market in an instant. Among them, in Hong Kong, the trading department of 'Huifeng Global Hedge Fund', Jeremy, who is the department's market information collection specialist and also the head of the fund's market intelligence department, hurriedly and happily reported to the fund manager Godfrey.

"Is that accurate news?" Godfrey asked anxiously, his eyes lighting up.

Jeremy nodded and said, "I just received news that the Bank of England's Monetary Policy Committee has unanimously agreed to release $100 billion of foreign exchange reserves to the global trading market today and to recover a corresponding amount of pounds at the current market exchange rate."

"Great," Godfrey said happily, "The daily volume of $100 billion is far beyond our expectations."

"But... in addition to this news, there is also a piece of bad news." Jeremy paused and continued, "According to market news, UBS International has begun to massively reduce its long positions."

"'Andrea's Hedge Fund at UBS International'?" Godfrey asked.

Jeremy continued to nod and responded, "Yes, it is 'Andrea Hedge Fund of UBS International'."

"UBS International's Andrea Hedge Fund was an absolute bullish institution in the pound exchange rate market before." Before Godfrey could speak, Ernest, the head of the market research department, frowned visibly. Looking at the pound exchange rate that was still fluctuating downward, he asked in confusion, "The Bank of England has already made intervention measures beyond expectations. Why did this major hedge fund give up its investment strategy plan of continuing to go long and hold long positions?"

"Could it be that... there will be changes and surprises in the referendum results tomorrow?" Gerald, the fund trading team leader, felt a little nervous at this time and guessed.

"Impossible." Although Godfrey could not guess the motive of UBS International Andrea Hedge Fund to reduce its long positions, he was sure that the motive of this main fund to reduce its positions would definitely not be the factor guessed by Gerald. "If the expected result of tomorrow's referendum really changed dramatically, then the Bank of England would not increase its intervention in the market at present.

After all, if the exchange rate of the pound cannot be stabilized through this kind of intervention.

Then the current actions taken by the Bank of England are meaningless.”

"The key now is... can the intervention measures taken by the Bank of England really curb the run on the pound?" Gerald said, "I heard that the pound exchange rate has fallen to around 1.46 on the black market. Under this situation, if Wall Street short-sellers increase their efforts to sell the pound and deliberately spread panic about the run on the pound, I'm afraid that the 100 billion US dollars of foreign exchange reserves released by the Bank of England to the market will be difficult to reverse the downward trend!"

"As long as confidence can be restored," Godfrey said, "as long as everyone expects the referendum result tomorrow to be in favor of remaining in the EU, and as long as everyone believes that the Bank of England's intervention in the market is releasing this expectation and is strongly supporting the market, then the pound exchange rate will definitely rebound from the current level."

"That's right." Ernest nodded. "In the current pound exchange rate market, confidence is more important than gold!"

"But..." Gerald hesitated for a while and then said, "At the current pound exchange rate, the long positions held by our fund as a whole have begun to fall into a loss state. In addition, our positions are too heavy. If the trend is not as expected, we will fall into a very passive situation. Mr. Godfrey... Do you think we need to take advantage of the rebound of the pound exchange rate to reduce our positions and avoid possible extreme risks?"

Godfrey said firmly: "No, as long as the pound sterling market exchange rate does not break 1.5000, it will always be within our expectations. In fact... Looking at the market, all the news and trends are in line with our previous predictions."

"If the pound sterling exchange rate can rebound quickly at this position, it will be a positive feedback to the news, and it will also confirm our speculation." Ernest also said, "What's more... in the market news, the potential expectations are all biased towards the long direction. Wall Street short-selling capital manipulates the black market exchange rate and deliberately creates a run on the pound by global investors. This behavior is also difficult to affect the direction of the pound sterling exchange rate for a long time.

As long as the Bank of England's market intervention behavior consolidates everyone's confidence.

Then, the major core institutions and smart capital groups in the market who have come to their senses will instantly realize that this is just the panic created by Wall Street short-sellers who are afraid that they will not be able to leave the market safely after the referendum results are announced tomorrow. It is also a last-ditch counterattack by the short-sellers in the market in order to leave the market. "

"Is there really no surprise in the referendum result tomorrow? Is it really certain that China will continue to stay in the EU?" Sato, the main fund manager of Mitsui Jiayou Hong Kong City Investment Co., Ltd., which is associated with Huifeng Huanyu Hedge Fund, asked during the discussion. "If this expectation is certain, then our institution will not reduce its position at this position and will follow Mr. Godfrey's lead."

Godfrey responded: "Mr. Sato can take a look at the preliminary vote counts released by the British government. According to the preliminary vote counts, the number of people who agree to remain in the EU is about 55%, which is basically a referendum result that confirms the continued EU membership."

"If that's the case, then why are the short positions in the market not only not decreasing, but increasing rapidly?" Yamamoto Hisaichi, a core trader in the main fund trading department of Mitsui Yoshitomo Investment Company, asked in confusion, "Logically... the short positions in the market should have decreased sharply at this time, and the pound exchange rate should also reflect the expected results of tomorrow's referendum in advance."

"With a bunch of short-selling capital on Wall Street interfering, the market trend will naturally be different from expectations." Ernest responded, "But no matter how the short-term market trend fluctuates, the final breakthrough direction must be consistent with everyone's expectations."

"I looked at the preliminary vote count results released by the British government and found that about one-third of the regions have not yet released the vote count results." Sato said, "What is the possibility of accidents in these one-third of regions?"

Godfrey responded: "Hardly."

"Why do you say that?" Sato asked.

Godfrey continued to respond: "Among the one-third of the regions that have not yet released preliminary vote counts, almost two-thirds are relatively core areas in England, and only one-third are in Scotland. According to the preliminary voting results of other core areas, the relatively core areas in England are all inclined to remain in the EU, so the overall referendum result will definitely not be surprising."

Sato said: "So... as long as we can survive tonight and the desperate counterattack of Wall Street short-sellers, the final victory will belong to us."

"I estimate that during the U.S. trading session tonight, Wall Street short-selling capital institutions will definitely stop losses and close their positions on a large scale after finding that they cannot break through the 1.5000 point and cannot completely cause the main long-term institutions in the market to trample on each other." Godfrey said, "Under the high probability of the referendum result, there should not be many short-selling capital institutions that are determined to bet on the final referendum result."

"I hope so." Sato nodded.

He continued to ponder for a moment, and finally gave up the idea and strategy of large-scale concentrated stop-loss and position reduction at this position, and decided to continue holding the large-scale short position that had already fallen into a floating loss state.

At the same time, within Tianhe Capital, which is linked with the two major institutions.

After listening to everyone's analysis and learning the latest market news, Gu Chijiang calmed down and gave up the idea of ​​reducing his position and stopping losses.

It's next to Gu Chijiang.

Xie Hongxing, manager of the Tianhe Capital trading team, who has been paying close attention to the changes in the exchange rate of the British pound, has always been worried and concerned.

It's just that his concerns and the risks he analyzed.

In Gu Chijiang's mind, Godfrey's analysis and opinions were not given enough attention.

As the three major institutions have decided to continue holding positions and insist on waiting to see the result of tomorrow's referendum, the pound exchange rate market...

The exchange rate trend of the pound was exactly as Godfrey had expected.

After a brief period of calm, with the Bank of England's tough intervention in the market and the news of a large-scale concentrated release of foreign exchange reserves, the relevant positive news also fermented throughout the market.

Around 6:40 pm Yanjing time.

The pound sterling exchange rate once again drew a straight upward line on the trading board, jumping more than 1.5120 points from around 80 points to successfully stand above the 1.5200 point mark.

It's just that this positive news feedback brought about a surge in prices.

It only lasted an hour or two.

Then, at around 8 o'clock in the evening of Yanjing time, which was the end of the European trading session, the market continued to fall into a volatile downward trend.

"Boss Su, looking at the market trend of the British pound exchange rate, the bulls seem to be powerless to turn the tide."

At this time, in the main fund trading room of Huayi Capital Company, 'Huayi Chengyuan No. 1', the trading team manager Qu Zecai saw that the pound exchange rate rebounded and then fell again. He couldn't help but smile and said with a smile.

Tonight is destined to be the most brutal night for the battle between bulls and bears in the pound exchange rate market.

So, after taking a nap in the afternoon, Su Yi came back to the company after dinner, deciding to work late into the night.

At the same time, all the trading groups in the trading room are on high alert tonight, waiting for the start of this spectacular battle between bulls and bears.

"It's a bit too early to say that now." Su Yi said with a smile, "After all, there are still 20 hours before the referendum results come out tomorrow. During these 20 hours, market news changes most frequently and the trading period with the highest uncertainty is exactly the time. Anything can happen on the market."

"Mr. Su is right." Meng Shengfei, manager of the second investment department of Huayin International, an institutional trading center associated with Huayi Capital, responded with a smile, "In the next 20 hours, many financial institutions and investment institutions around the world, as well as many retail investors and hot money groups that invest and speculate in the pound exchange rate market, will probably have a hard time falling asleep."

"It's not just the investors and speculators in the financial market." Kong Fansheng from Huayin International's investment department said, "I guess the British government's central bank, cabinet ministers, members of the two sessions, and the counting agencies of various districts and regions... countless people whose own interests are at stake will find it difficult to fall asleep during these 20 hours."

"Mr. Su, do you still maintain your previous judgment and forecast?" Frederick, from the hedge fund trading department of Aberdeen Asset Evolution No. 1, said with a smile, "If you want to change your strategy now, it's not too late!"

Su Yi responded: "I still hold the same view as before. Regardless of the referendum result tomorrow, with the internal contradictions in the UK becoming increasingly prominent and the EU economic recession becoming an inevitable fact, the pound exchange rate will only continue to depreciate. So... I will not change my trading strategy, and I do not think that the Bank of England has the ability to turn the tide. In fact, many Wall Street investors have already seen this."

"Mr. Su's courage is truly admirable," said Frederick. "I firmly believe in this."

"The market's net long position had slightly rebounded after the news that the Bank of England released its foreign exchange reserves, and now... it has returned to the scale of 50 lots." Meng Shengfei said, "It seems that there are more and more smart money in the market, and more and more longs are closing their positions to stop losses."

"The main reason is that global financial institutions, investors, and many multinational trading companies have been running to sell pounds, and this run has not been reversed by the Bank of England's market intervention," Kong Fansheng said. "In fact, judging from the market trend of the pound exchange rate, the bulls still dominate the market, but the black market exchange rate has collapsed."

"The Bank of England reacted too slowly," Frederick said. "In fact, they should have intervened in the market forcefully a long time ago. Unfortunately... Brian still hasn't learned the lessons of history."

"If everyone continues to sell off the pound, the confidence of the main long institutions in the market will collapse before tomorrow morning, right?" Meng Shengfei said, "I feel that the current scene is very similar to the scene of the 'Swiss franc black swan' night last year."

"There is still a difference." Su Yi said, "The storm on the market this time will be even bigger."

Following a brief conversation between several people.

The pound sterling exchange rate has once again fallen below the 1.5100 mark.

At the same time, the net long position in the market quickly dropped to about 35 lots, and the unclosed short position increased sharply to nearly 500 million lots.

And, at the same moment.

On the other side of the ocean, London, a core city in the UK that was not included in the first batch of preliminary voting results, the preliminary counting results of Leeds were released, and there was an unexpected and huge deviation from the statistical results generally predicted by major institutions and the general expectations of the market.

And this huge deviation result has not yet been officially announced.

Just when the pound sterling exchange rate had just fallen below the 1.5100 mark, it plunged again, continuing to crash by more than 70 points, and retreated to the 1.5000 point level, the last psychological defense line of many long institutions in the market, at a lightning speed.