Gold prices plummet, with some brand gold jewelry dropping 62 yuan per gram in one day! Some people who bought gold jewelry without even wearing it faced losses close to 2000 yuan the next day. Does gold still have medium to long-term allocation value?

According to CCTV Finance, on March 19, international gold prices experienced a sharp decline. As of 9:35 PM, COMEX gold briefly fell near the $4,500 mark, with a low of $4,505 per ounce, a maximum drop of 7.99%; London spot gold also hit a low of $4,502.01 per ounce, with a maximum decline of 6.47%.

On March 19, domestic gold jewelry prices clearly retreated: Chow Sang Sang’s pure gold jewelry prices dropped to 1,492 yuan per gram, a decrease of 55 yuan for the day; Lao Feng Xiang quoted 1,498 yuan per gram, down 42 yuan.

On March 20, spot gold prices rebounded, rising by 1.65% as of the time of reporting.

Gold jewelry prices per gram fell

Some people bought gold jewelry but haven’t worn it yet

Facing nearly 2,000 yuan in paper losses the next day

On March 20, prices for gold jewelry from various domestic brands also saw significant declines.

According to Elephant News, Lao Miao Gold’s pure gold price on March 19 was 1,507 yuan per gram, and today (March 20) it is quoted at 1,445 yuan per gram, compared to 1,550 yuan two days ago. This means after a 43 yuan drop yesterday, it fell another 62 yuan today, totaling a 105 yuan decline over two days.

Chow Sang Sang’s gold jewelry price is 1,443 yuan per gram, down 49 yuan from 1,492 yuan.

Lao Feng Xiang’s gold jewelry price is 1,443 yuan per gram, down 55 yuan from 1,498 yuan.

According to Cover News, Xu Lili, a resident of Mianyang, Sichuan, said that based on her experience over the past six months, she adheres to the strategy of “buy big dips, buy small dips.” Starting from March 12, she bought in batches for seven consecutive days but failed to catch the real bottom; instead, she kept getting trapped. An employee at a gold shop said that despite sharp fluctuations in gold prices, the store adjusts prices seven or eight times a day and sells 2 to 3 kilograms of gold daily. Unlike anxious investors, ordinary consumers tend to be much calmer.

Chengdu resident Liu Dan (pseudonym) bought a 20.45-gram Wudi coin pendant on Lihua Street on March 17, with a gold price of 1,119 yuan per gram plus 49 yuan for craftsmanship, totaling 1,167 yuan per gram. However, just overnight, the gold price fell, and before even wearing the jewelry, the paper profit turned into a nearly 2,000 yuan loss.

Is the value of medium- to long-term allocation still intact?

Is the value of medium- to long-term allocation still there? Looking ahead, most market opinions believe that the trend of precious metals still largely depends on the intensity and duration of the current Middle East geopolitical conflict.

Kavak Macro’s Chief Market Analyst pointed out that although geopolitical risks continue to rise, under the environment of a strong dollar and high oil prices, gold remains under pressure. Increased market volatility has also prompted some investors to close gold positions to meet margin requirements for other assets. “Market expectations of an imminent rate cut by the U.S. have been a key driver of gold’s rise, but soaring oil prices weaken the expectation of monetary easing, which to some extent undermines the support for gold prices.”

“Currently, the main focus remains on geopolitical issues. The blockade of the Strait of Hormuz directly threatens 20% of global oil supply. If military conflicts spill over to energy infrastructure, further oil price increases will force funds to return to gold to hedge against runaway inflation. If inflation spirals out of control, real interest rates will also decline, further supporting gold prices,” suggested Zhan Dapeng, Director of Research at Everbright Futures. He advised investors to adopt a buy-the-dip strategy. Regardless of future inflation expectations or stagflation concerns, gold’s strategic allocation position will be enhanced. Under liquidity worries, this also presents an opportunity for investors to buy on dips.

Bai Suona pointed out that in the medium to long term, gold still holds value. Amid ongoing global geopolitical uncertainties and the continuous push for de-dollarization driven by the U.S. debt, central banks and institutions worldwide are likely to continue purchasing gold, which could support precious metal prices. After recent shocks, the space for further sharp declines in precious metals prices may be limited. Strategically, investors can consider long-term buy opportunities. Wells Fargo’s year-end target price range is $6,100 to $6,300 per ounce, based on the structural support for gold: continuous net purchases by central banks over many years, the slow erosion of the dollar’s long-term credit, and geopolitical risk premiums that are temporarily masked by rate-cut narratives but have not truly disappeared.

Source: CCTV Finance, Cover News, Elephant News, Public Information