Chapter 94: Bearing the burden, a decisive reversal

The spot market opened with the European session.

The volatility had changed somewhat from its earlier lukewarm pace. Near the 6,150-point level, Zhang Long once again asked Huiyin for a trading recommendation and continued to buy into the rebound.

As before, the call was for a rally that would run out of steam near 6,200 points. No need to say more—another round.

...

"Damn, that feels good."

"Two waves, net profit three hundred thousand!"

The trading desk at Huiyin was in an uproar. Spot silver had not been moving much today, but it had been steady, and Zhang Long had caught both the rise and the fall in two waves, completely nailing it.

Each trade made only seventy-five thousand, but four trades across two waves came to three hundred thousand. That was no small sum.

Of course, Zhang Long was not the only one making money today. Many clients had profited as well, and there were others who had made the same four trades as Zhang Long, though not many.

Today’s advice from Huiyin to clients had been to buy on the rebound near 6,150 points and go long. That was correct.

At 6,200 points, some colleagues also wanted to make money and had prompted clients to short for the pullback.

So Zhang Long’s performance did not shock everyone too much today—or rather, they had become immune to it. A net profit of three hundred thousand was certainly a lot, but on Monday and Tuesday alone Zhang Long had made 1.5 million. Compared with that, this was merely icing on the cake. Let them be amazed when he made five million in a day.

As for whether Zhang Long could do it—there was hope.

"Man, now I want to trade too."

"Follow Brother Long’s lead. Bold and decisive."

Unlike the financial securities industry, the spot market did not strictly forbid employees from opening their own accounts; each platform merely restricted trading through one’s own company.

The executives understood very clearly what finance and investing were really about, and how the spot market behaved.

If you wanted to make money, it was basically impossible.

Even if you won five times or ten times, a single stubborn losing trade in which you refused to cut the loss would ruin you—seriously hurt, left half-disabled.

Besides, if employees were secretly trading spot contracts, whether they won or lost was one thing, but it would certainly affect their work performance. Sales and coaching would both suffer. So honestly doing one’s job was still the right path.

Spot trading allowed unlimited intraday transactions under T plus zero settlement, and if performance was good, transaction commissions were nothing to scoff at.

Greed would only lead to a vicious fall.

...

"Damn, it broke below support."

"Shit, this thing is freakishly nasty."

Zhang Long was holed up at home trading spot silver. After two profitable waves and four trades, he had to admit he was getting a little carried away. He bought another fifty lots near 6,150 points, but this time it seemed to prove the old saying about not suffering the same mistake three times. At last, it broke down and he took a loss of forty points.

One hundred thousand yuan vanished on the spot.

And when the price fell to the vicinity of 6,100 points, yesterday’s rebound support, Zhang Long bought long again.

This time he still did not ask Huiyin for advice, yet the market kept breaking down and was about to trigger his stop-loss.

If it reached 6,055, he would be stopped out.

At that moment Zhang Long felt a headache coming on. If he was stopped out, so be it—but if he did not stop out and instead it rebounded, then all of this would have been for nothing.

He had already used up two pieces of trading advice today. After hesitating for a moment, Zhang Long decided to add another thirty lots.

At the same time, he canceled the prior stop-loss order.

That kind of move was no different from what ordinary investors did: when the stop was nearly hit, they refused to admit defeat and chose to gamble on luck. And more often than not, luck betrayed them while misfortune came true. Most of the time, they would keep losing all the way down, badly jinxed.

The fifty-lot short had already lost more than one hundred thousand, and the additional thirty-lot long consumed the remaining funds in the account.

If the price fell further, there would be no money left to add.

Eighty lots, fifty kilograms. Every additional point down meant a loss of four thousand yuan. Ten points meant forty thousand. Fifty or one hundred points, and hundreds of thousands would be gone. Extremely painful.

Of course, if Zhang Long stubbornly held the position and did not exit, then as long as the market did not break sharply downward by several hundred points all the way, he would be fine.

And even if he were forcibly liquidated, the remaining funds in Zhang Long’s account were still over a million.

In other words, his principal had not been lost.

But that was only because his prior profits had accumulated such a strong cushion. If he were to suffer another disastrous loss from stubbornly holding a losing position, a million in principal would be cut in half, and then cut in half again, endlessly halved.

That was why the platform did not worry in the slightest about clients making money. As long as they refused to cut losses when they should, it was all over.

Whether once or twice, or many times.

...

"Wow, Brother Long is holding the loss."

"Is my idol about to take a big hit?"

Wang Jing listened to her colleagues discussing it and felt uneasy. What was meant to happen had still happened. How could anyone stay absolutely rational forever? However bold Zhang Long had been in earlier trades, today he had still made a mistake and started holding onto a losing position.

Just now, silver had fallen below 6,050. By rights, Zhang Long’s fifty-lot short should have been stopped out, but instead he canceled the stop and added thirty lots, continuing to go long.

Although, judged by margin alone, even if the market plunged all the way and he were force-liquidated, his principal would still be intact.

But there was a huge difference in transaction volume between trading with nearly three million and trading with just over one million.

Moreover, once a client got into the habit of refusing to admit a loss and holding a losing position, it was rarely a one-time thing. Once the pattern started, the next time they were in the red they would instinctively want to hold again.

Even after being brutally beaten by the market, that streak of wishful thinking remained. Everyone had it. That was human nature.

Thinking of this, Wang Jing pressed her lips together and drafted a risk-control advisory text message.

Her job had to be done. She could not fall behind.

Buzz, buzz buzz—

At Riverside Dragon Residence, Zhang Long suddenly received Wang Jing’s message. He was surprised, though not entirely surprised. If he was holding a losing position, Huiyin would certainly know. In fact, seeing the floating loss in his account, he already regretted being too aggressive and had been about to ask for a suggestion. It was like a pillow arriving just when he was drowsy—perfect timing.

Risk-control advice was still advice, warning him that current volatility was unfavorable and indicating where support lay below.

A direction and a level were enough.

After scanning the risk-control message, Zhang Long looked back at the market. In an instant, his precognition kicked in, and he blurted out a curse.

"Shit, what the hell."

It was not that the price would really break down in one straight line. Silver would stop falling at 6,000, and Zhang Long’s account funds and margin could fully withstand it. It was just that once the price reached around 6,000, he would have no money left to keep adding long positions.

That was the real headache. He would be unable to catch the rebound.

...

"Refusing to cut the loss—damn it."

Zhang Long cursed fiercely.

He had already used up his three precognitive chances today, and whether yesterday’s remaining one could be carried over to today still remained to be tested.

All six million in his three stock accounts had already been tied up, though the agency account still had four million left.

But that was Qian Caiying’s money, and even if he were allowed to withdraw it, the stock market’s cash withdrawal window had long since closed. He could not take it out.

As for the several hundred thousand left in his bank card, even if he transferred it into the account, it would be useless. After all, he had two positions—one one-hundred-point hold, one fifty-point hold.

So he had become like a fish on the cutting board, helpless, able only to watch it fall until it gave out near 6,000 points.

As for how much it might rebound by evening, he had no way of knowing. Perhaps 6,030, perhaps 6,050—anything was possible, impossible to pin down, unless he cut it now.

"Fine, let’s do it!"

Zhang Long took a deep breath. He could not sit and wait for the losses to pile up all the way to 6,000.

Today’s recklessness had taught him a lesson. He had been making too much money lately and had become a little overconfident.

Reality was merciless. One could not act recklessly.

"Huh? Brother Long cut it?"

"Wow, that harsh?"

At Huiyin Trading Department, Wang Jing was also a little stunned. She had only sent a vague risk-control suggestion, implying that he should not hold a loss against the market. And he had just obediently cut the position?

That was too cooperative. It was strangely abrupt.

But whether it was Huiyin or Wang Jing, Zhang Long was not being cooperative to avoid holding the loss. Through precognition, he knew the price would keep falling, so he hurried to get out while also going all in on the short side.

If the price fell to around 6,000 and then turned back up, he would make back the losses from the first two waves with the gains from the next two.

Timely replenishment, a fence after the sheep are lost.