The persistent volatility in gold prices is not only evident in trading markets but is also influencing the consumption decisions of ordinary consumers. A recent investigation has revealed that following gold's "precipitous drop" on January 30th and its continued decline, some consumers who purchased gold jewelry at the peak are now considering "canceling orders" or immediately seeking "repurchase," while a larger number of potential buyers holding cash are plunged into a new wave of indecision.
"Just last week, gold prices were at a high, but today I see they've fallen so much. I bought this bracelet on January 29th; it hasn't been seven days yet, and the tag is still attached. Can I return it?" On February 1st, at a well-known gold store in a Chengdu shopping mall, a customer approached the sales counter with recently purchased jewelry to inquire.
As of February 2nd, the spot gold price had retreated to around $4,690 per ounce, a significant pullback from its peak. This frenzy, shifting from fervent chasing to panic selling, is not only straining the nerves of every investor but also prompting deep market reflection on whether the fundamental logic of the gold bull market is changing.
Can gold jewelry bought at a high price be returned under a seven-day no-questions-asked policy? On February 2nd, as gold and silver prices experienced sharp fluctuations, the quoted price per gram for pure gold from major domestic brands like Chow Tai Seng and Chow Sang Sang adjusted downward accordingly. The previous scenes of long queues for gold purchases have vanished, replaced by an increase in customers inquiring about repurchase.
Many consumers are asking: with the gold price plummeting, can they return recently bought gold jewelry? "Whether a refund is possible after a sharp drop in gold prices depends on the specific circumstances," stated Qin Wen, a lawyer from Yingke Law Firm in Shenzhen. Typically, gold jewelry purchased from physical stores is not accepted for refund or return once it leaves the counter; merchants often refuse refunds citing "goods already sold." Some brands may explicitly state in community guidelines that they "do not accept return requests due to gold price declines" and may even deduct high handling fees. "For gold jewelry bought online, if the product is marked as eligible for 'seven-day no-reason returns,' and the item remains in perfect condition within 24-48 hours of receipt, a return can be requested, though a handling fee of 1%-5% might apply."
Lawyer Qin Wen advises consumers to carefully read the merchant's return and exchange policy before purchasing gold jewelry, paying special attention to clauses regarding price fluctuations, handling fees, and return deadlines. If there are any doubts about the return policy, it is recommended to confirm with the merchant before purchasing to avoid subsequent disputes.
An intense game of multiple factors is underway, revealing divergences among professional institutions. "The plunge is normal; there's no need for panic," analyzed Zhu Zhigang, Supervisory Board Chairman and Chief Analyst of the Guangdong Gold Association, in an interview. "Gold was severely overbought before, and signs of market manipulation by capital were also quite evident."
The severe turbulence in the gold market results from the combined effect of multiple factors, with the resonance between policy expectations and market sentiment being particularly critical.
Personnel changes at the Federal Reserve and a strengthening US Dollar may be the direct triggers for the gold price decline. Several industry analysts revealed that the announcement by Trump nominating former Fed Governor Kevin Warsh, perceived as a "hawk," for the next Fed Chair was the direct catalyst for this sharp drop.
According to an analyst from J.P. Morgan, Warsh has consistently advocated for tighter monetary policy. The expectation of his nomination boosted the US Dollar Index, and a stronger dollar makes dollar-denominated gold less attractive to foreign buyers. Simultaneously, expectations of rising interest rates increase the opportunity cost of holding gold, a non-yielding asset.
Beyond fundamentals, factors on the trading front cannot be ignored. Cheng Xiaoyong, Director of the Huawen Futures Research Institute, pointed out three major risks: the Fed not continuing to cut interest rates, the fading of safe-haven buying, and a stampede-like exodus caused by concentrated liquidation of long positions in precious metals. Li Gang, Research Director at the China Foreign Exchange Investment Research Institute, further explained that leveraged funds, trend-following capital, and quantitative strategies are highly concentrated in the market. Once short-term bullish factors are realized in phases, it is easy to trigger programmed stop-loss orders and concentrated profit-taking, amplifying volatility.
Facing this massive shake-up, professional institutions show diverging views on the market outlook. Optimists like J.P. Morgan explicitly stated in a report that they "remain firmly bullish on gold's medium-term trend," raising their gold price target for the end of 2026 to $6,300 per ounce, citing persistent structural demand from central bank purchases and investor diversification. UBS Wealth Management also raised its 2026 gold price target to $6,200.
Analysts from China International Capital Corporation pointed out that when gold prices exceed $5,500 per ounce, the total value of global above-ground gold stockpiles becomes equivalent to the total outstanding US Treasury debt—a first since the collapse of the Bretton Woods system, indicating signs of loosening in the anchor of the global monetary system. However, they also cautioned that gold prices have entered "uncharted territory," and future games and turbulence will intensify.
It is noteworthy that institutions are generally more cautious towards silver than gold. J.P. Morgan analysts noted that silver lacks the support of structural central bank buying, its price drivers are harder to quantify, and its volatility is greater.
How should investors respond? Experts recommend an asset allocation perspective. For ordinary investors, anxiety and confusion in the face of such intense market volatility are inevitable. Should investors flee the market or buy the dip?
"Acknowledge volatility and avoid chasing rallies and selling in panic," Zhu Zhigang repeatedly emphasized in the interview: "From an allocation perspective, there is no need to panic; the decline is actually an opportunity." Zhu Zhigang suggests investors adopt a "small,分批 [batch]" approach to buying, particularly for physical gold, which should be viewed as part of a family's asset reserve rather than a pure speculative tool. "Many people who have made money on physical gold buy a little when it falls and sell a little when it rises."
Retail investors need to define their allocation ratio and investment targets clearly. For family asset allocation, Zhu Zhigang still recommends allocating "5% to 20% of one's own disposable funds to physical gold," quantified as 50 to 100 grams. He emphasized that this allocated portion should not be completely liquidated or fully invested based on short-term price fluctuations; "one should still keep some gold in hand." Regarding different investment vehicles, he believes physical gold and gold ETFs are more suitable for ordinary investors, while leveraged instruments like futures carry extremely high risks and are only suitable for professionals.
"Whether investing in ETFs or other gold financial products, setting clear stop-loss limits is crucial," Zhu Zhigang advised. Ordinary investors should set stop-loss lines, such as 5%-8%, based on their own risk tolerance. For consumers holding gold jewelry or bars, his advice is: "We judge that gold prices will still rise in the long term. Every price drop is an opportunity to rebalance the allocation ratio, not a disaster."
Following the market's sharp decline, several listed companies, including Hunan Gold and China Gold, have issued announcements regarding abnormal stock price fluctuations or operational risks, cautioning investors to view the relationship between gold prices and stock prices rationally. Gold may have entered a new era, but this process will inevitably be accompanied by "intense games and turbulence." For investors, while focusing on gold's long-term trend, it is even more essential to pragmatically manage the risks associated with short-term volatility.
In a market full of uncertainty, adhering to allocation discipline and steering clear of emotional trading is the more stable path to navigating cycles and harvesting the rewards of "true gold."
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