Chapter 28: The London Gold Market

Words : 1325 Updated : Sep 10th, 2025

Chapter 28: The London Gold Market At the start of a new week, Chinese Online saw two consecutive limit-ups, with its stock price surging to 41.65 yuan, setting a new historical high. It made its third appearance on the Dragon and Tiger List, becoming the hottest stock this year after Baofeng Technology. “Voices don’t disappear even when predictions are wrong, but outcomes can deviate due to human interference,” Lu Liang mused. Over the past two days, he had chosen to liquidate his positions and observe, missing out on two limit-ups. However, this confirmed a theory: the messages from the "Voice" were not 100% accurate. His existence as an external factor introduced the greatest unpredictability. Having already earned 12 million yuan from Chinese Online, Lu Liang had nearly caused market chaos twice with his aggressive clearing of positions, cashing out at peak prices. The main players were forced to push the stock price even higher to avoid being trapped by their own positions. "The voice triggers at midnight." "Perhaps the conditions are linked to the activities I engage in?" Lu Liang jotted down his insights into a notebook, tore out the page, and tossed it into an ashtray. Lighting a cigarette, he took a deep drag, exhaled a plume of smoke, and watched the flames consume the paper until nothing but ashes remained. At night, he sat alone in his study, browsing financial news while waiting for the clock to strike midnight. The Shanghai Composite Index had achieved its fourth consecutive day of gains, breaking past 5100 points. The market was in a frenzy. Former colleagues on his social media posted photos of long lines at housing registration offices. For weeks now, this mania had persisted as people sold or mortgaged their homes to speculate in the stock market. "Is such a scene even sustainable in our country?" Having time to observe the market while holding no positions, Lu Liang studied it in depth. As a seasoned real estate professional, he understood the critical role real estate played in China’s economy. One could argue that the combined power of the financial sector’s three major boards paled in comparison to the real estate market. For a house with a market price of one million yuan, potential taxes could exceed 500,000 yuan. Only after deducting manpower costs did profits trickle down to real estate developers. Real estate tied into numerous industries—construction materials, home furnishings, appliances—and created countless jobs. Now, people were either selling houses to speculate in stocks or diverting funds meant for home purchases into the market. Was this truly what the government wanted? Unlikely. "This bull market might be nearing its end." Extinguishing his cigarette, Lu Liang took a sip of coffee. As midnight struck, a mysterious voice echoed in his mind, as though from another world: [June 5th, London Gold, 1517.2500 points.] Lu Liang was taken aback. He had envisioned many possibilities but hadn’t expected international spot gold to be the subject. Commonly referred to as "London Gold" due to its origin, it had a 300-year history as the world’s largest spot gold trading market. With a daily trading volume of 20 trillion U.S. dollars—25 times the size of China's A-shares—it was beyond the manipulation of any institution or consortium, relying purely on market self-regulation. Ŕ????????Ȱ????ĘŜ "The current price is 1347.1200 points, a potential increase of nearly 160 points," Lu Liang calculated, his eyes gleaming with excitement. Gold, as the most stable primitive currency, rarely fluctuated unless major powers clashed or financial crises arose, driving large funds toward safe-haven assets. Because its price movements were small, gold trading offered a minimum leverage of 100 times, hence the four decimal points in quotes. A 160-point increase might seem modest, but with the right operations, turning 100,000 into 1 billion wasn’t impossible. This also indirectly validated Lu Liang’s theory: the domestic bull market was peaking, with major funds flowing into gold markets for risk aversion. As the night deepened, the study remained illuminated. With a cigarette in one hand and coffee in the other, Lu Liang delved into the trading rules and mechanics of London Gold. Unlike China’s stock market, which used a T+1 trading model—where purchases made today could only be sold the next day, and only long positions were allowed—London Gold operated on a T+0 model, like most global financial markets. Under T+0, assets could be bought and sold on the same day, allowing for both long and short positions. This system favored institutions but disadvantaged retail investors. Although initially intended to protect retail traders, it was ultimately exploited by institutions. London Gold also offered 24-hour continuous trading, from Monday evening to Saturday morning, with breaks only on weekends. Trading sessions followed daylight hours across regions, starting with the European session in the afternoon (Beijing time), followed by the American and Asian sessions. The most active period was from 10 PM to 5 AM Beijing time, accounting for nearly half of the day’s trading volume. This overlap of the European afternoon and American morning sessions was far more dynamic than the Asian session. By 3:30 AM, Lu Liang had gained a solid understanding, though there were still gaps in his knowledge. He planned to learn through practice. He logged into his brokerage account, exchanged $10,000, and leveraged it 400 times, boldly entering the London Gold market. The high leverage reflected gold’s low price volatility and high trading thresholds. Each trade required a minimum of one lot (100 ounces), equivalent to 3,110.35 grams of gold. At the international gold price of 272 yuan per gram, a single lot cost 846,000 yuan, or $133,200. S~eaʀᴄh the NôᴠeFire.ηet website on Google to access chapters of novels early and in the highest quality. Lu Liang’s $10,000 exchange included $5,000 as margin and $5,000 as usable funds. With $2 million in leveraged capital, he could only afford 15 lots. Cautiously, he bought five lots initially, observing the market before committing further. For every three-point drop in price, he added one more lot, knowing a five-point drop would result in liquidation. If his margin fell short, he would inject additional funds. By 5 AM, the market hadn’t fully activated but showed signs of a slow upward trend. Lu Liang had invested $80,000, with $40,000 as margin, holding assets worth $1.617 million. Of this, $1.4 million was borrowed, leaving him with $17,000 in equity—$13,000 of which was profit after deducting his principal. "At an exchange rate of 6.35, that’s over 800,000 yuan in profit?" Lu Liang marveled at the speed of the gains. He had barely done anything, simply averaging down during dips and holding through the rise. There was one heart-stopping moment when the market plunged four points, almost triggering liquidation. Fortunately, with sufficient backup funds, Lu Liang quickly injected an additional $20,000 margin, averting a forced close. High leverage trading was a game of nerve and vigilance, requiring complete focus without a moment’s negligence. As dawn broke in early June, a pale white light began to spread across the horizon at 5 AM. The American session was nearing its end, and market activity significantly declined. Rubbing his eyes, Lu Liang fought fatigue, knowing the Asian session would soon take over. If his prediction was correct, the Asian session during the day could match the intensity of the European and American sessions. Lu Liang exchanged 5.84 million yuan for $920,000, transferring the full amount to his London Gold account. He still had over 4 million yuan in available funds but no further exchange quota. Having prepared everything, Lu Liang left the study, planning to take a shower and have breakfast to recharge. With $900,000 in margin now in his account, he felt confident his position could weather any intraday volatility without risking liquidation.

Chapter 28: The London Gold Market

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