Xing Baohua only needs to calculate the leverage ratio and how many points he can hold without being liquidated.

Set a stop-loss order?

It's a one-shot deal, why bother setting a stop-loss? It's either a win or a total loss in an instant. What if someone calculates it and you hit the target? Who are you going to complain to then?

Therefore, stop-loss orders can only be used to mislead people's behavior. Moreover, your stop-loss order is easily known to others at what price level, and experts can also calculate and know where your stop-loss order is set.

They'll launch a surprise attack, targeting your stop-loss level.

It's usually only newcomers to the industry who get taught by veterans: "Remember to always set a stop-loss order. If you don't, you won't even have enough money left for a pack of cigarettes. If you set a stop-loss, you still have a chance to recover your losses."

The purpose of sweeping is to stop losses.

After your stop-loss has been triggered many times, you'll find that the price that breaks the stop-loss level is always one or two points higher than the price you set. This is considered a very precise price level.

It's heartbreaking to see this kind of scanning done. It only results in one or two extra points; it would be so much better to move them back a few points!

If only I had known! There's no such thing as "if only I had known"! If I had known I would hit the stop-loss, I would have just reversed my position and made a huge profit.

Slippage is a technique used to trigger stop-loss orders. It involves no psychological factors; it's simply because the stop-loss point is calculated by the large institutions that set the stop-loss level for that area.

Just sweep it up; once you've got it all, how much you gain depends entirely on your leverage ratio.

Foolish people adjust the leverage ratio to 100, 200, 400, or even 800 if they're not afraid of death.

For example, in US dollars, a single lot requires a margin of $100, and a one-point increase in price results in a $1 margin. If you place 100 lots, you'll need $10,000, and a one-point increase will result in a $100 margin.

One million is tied up, and one point is worth ten thousand yuan. Keep in mind that in the exchange rate market, it's very normal to trade hundreds of points a day. Even capturing just 100 points amounts to a million yuan.

However, the prerequisite is that, regardless of whether you're bullish or bearish, the price cannot fall below your purchase price. Otherwise, you'll be liquidated. So, you must have funds in your account to cover any losses.

In other words, if the direction is reversed and the price is lower than what you bought, the price you earn will be the same as the price you made if you move down one point.

If you invest one million, a one-point increase might earn you ten thousand. But a one-point decrease might result in a ten thousand loss.

If the price drops by more than 100 points in a day, you will lose one million; if it drops by 200 points, you will lose two million.

Generally, the self-loss setting is set to be above 20%, so losing 200,000 and leaving the game is better than losing everything without a self-loss setting!

Therefore, whether it's a market maker or an institution, they've set up a trap, waiting for you to stop your losses at around 20%.

They have all sorts of tricks up their sleeves, constantly coming up with new and varied ways to trap you.

These institutions know that larger trading companies or financial institutions typically have contracts, which are either medium-term or long-term, making it difficult to trigger their stop-loss orders. It's also generally difficult to calculate their stop-loss levels unless there's a deliberate attempt to target them.

Have these large institutions taken steps to mitigate their losses?

Yes, and it's tiered. They're not guarding against speculators or institutions buying up stocks in the market, but rather against risks related to unexpected events, natural disasters, and things that happen to them.

The saying "risk and reward are directly proportional" is most aptly applied in the foreign exchange market. This represents a 1:1 risk-reward ratio. However, when it comes to leverage, the situation changes.

Everyone wants to get rich quick; the idea of ​​a 1:100, 1:400, or 1:800 ratio is exciting.

But have you ever thought that the real thrill of a margin call is even greater?

Xing Baohua only dared to use leverage of 20 or 50 times. That was only when he was very confident; if he had increased the leverage to the maximum, the market would have collapsed.

But the foreign exchange market won't collapse; it handles trillions of dollars in trading volume globally every day. However, the targets of such crackdowns won't be able to withstand the impact.

Putting aside the issue of disrupting other countries' financial markets, can they even afford to pay compensation?

If you have 10 billion, take 5 billion out and release it into the market, and use the remaining 5 billion as risk mitigation funds. Then leverage that 5 billion at a 1000x rate.

If the pound sterling moves 300 points a day, and you catch half of that, no, catch 100 points, that's a profit of 50 billion.

It would be strange if the financial system didn't collapse. Even if you got your hands on that money, MI6's 007 would probably be hunting you down all over the world.

Besides, even with 5 billion yuan multiplied by 1000, Xing Baohua could only withstand a fluctuation of 10%. A small wave would wipe him out.

At most 100 times, that's how bold Xing Baohua is. He only targets 100 points, he won't make more than that, he'll be content with 200 or 300 million, and even more would be better.

Socrates made a billion dollars and brought down the Central Bank of Sudan. But the problem wasn't Socrates' billion dollars; it was the numerous contracts that caused the losses, creating a chain reaction.

They figured they couldn't afford to lose money, so they simply went bankrupt, trying to minimize their losses as much as possible, acting like it was no big deal.

Xing Baohua also needs to calculate whether he can cause the collapse of the other party's financial ecosystem. It is not easy for Daying to accumulate wealth over hundreds of years, but if the financial ecosystem is destroyed, the consequences will be terrible.

It's like you've got your eye on a little flying figure on the front of a car, and you insist on pulling it out. You manage to pull it out, sell it to a scrap dealer for ten dollars, but when you look back, the car is completely broken.

The car repair alone would cost ten million. To damage something worth ten million for ten dollars—that's incredibly unethical!

For someone like Xing Baohua, who ruined the Great Eagle economic system for a few billion yuan, we will not rest until we have hunted him down to the ends of the earth.

There were still many things to handle and coordinate. The phone kept ringing and I was constantly answering calls; transferring funds was also a complicated matter.

Xing Baohua plans to have a good talk with managers from several world-class banks about the flow of funds in a while.

My dear reader, there's more to this chapter! Please click the next page to continue reading—even more exciting content awaits!