This is the script of CNBC's news report for China's CCTV on July 21, Tuesday.
Welcome to CNBC Business Daily, I'm Qian Chen.
The plunge in gold prices overnight has many worried about how to play the commodity in the short and long terms.
Gold prices fell as much as 4 percent to their lowest in more than five years on Monday as sellers in top consumer China offloaded the metal.
Investors have been finding less and less reason to hold gold as an insurance against risk, with the dollar strengthening ahead of what is expected to be the first increase in U.S. interest rates for nearly a decade.
Pressured by increased bets on a Federal Reserve rate rise this year, opportunity cost of holding the metal would increase.
Meanwhile, more than 3 million lots traded on a key contract on the Shanghai Gold Exchange, compared with fewer than 27,000 lots on Friday, Reuters data showed. Before Monday, the volume for July had averaged fewer than 30,000 lots.
Traders said it appeared that sellers had taken advantage of a low-liquidity environment, with Japanese markets shut for a public holiday, fueling speculative selling.
[Anthem Blanchard, Anthem Vault CEO] "I think we are gonna continue to see the range bound, I think we are gonna see a lot more dollar strength because the concern we see in Europe, the concern we have seen in China, so I think we have seen a flight to safety in the dollar. And possibly, i've also seen some liquidization of god possibly from Chinese speculators as well, getting some liquidities there to cover positions."
Technical analysts also warned of "bearish features" on the gold chart.
"The break of the critical $1,130 support level now makes the technical picture look very weak," ANZ said. "Short-term supports sit at $1,085 and $1,050, while topside resistance at $1,130 looks pretty solid."
But for the longer term, Daniel Hynes from ANZ said gold prices might go up again due to rising demand from Asia.
[Daniel Hynes - ANZ] "I think they've hit a fairly key level at the moment, so really, for things to go lower at this moment, I think we need to see another sort of negative event hit the market, so outside of that, I think we may have seen the lows. Longer term though, we still think gold at $1400 per ounce after several years is a possibility."
CNBC's Qian Chen, reporting from Singapore.
>>> Jason Li doesn't seem very different from other high schoolers in Beijing.
>>> The 17-year-old likes to play football and joke around with his peers.
>>> But he's the only one they've nicknamed Buffett.
>>> LT: Jason Li
>>> "All my friends know I've liked stocks since I was a kid. Some of them have started investing, too."
>>> Li's fascination with the stock market began at the age of 7 - when he first started reading books about the American billionaire investor.
>>> "Did anyone inspire you to invest?"
>>> "Yes, it's Buffett. We all know that he is the world renowned god of stocks."
>>> With Chinese government policies favoring equities - this fan of Buffett and Bieber - decided to invest last September.
>>> He took 1600 dollars of stashed birthday and holiday money and parked it in the Shanghai index -- picking stocks based on the philosophy of another big American investor.
>>> LT: Jason Li
>>> "Peter Lynch says he would buy stocks from watching what his wife buys at the supermarket. He links it to everyday life. 0219 My uncle bought stocks in a drone company because he loves drones. So I found a drone maker and invested."
>>> Li made the right moves - quadrupling his investments -- though the recent stock plunge knocked off a quarter of their value.
>>> His advice for inexperienced investors in China? Stomaching the wild volatility is part of the game.
>>> "Many people just blindly follow what others do. I don't find it very sensible. My advice is to do your research. After all, there are risks in the stock market."
>>> Spoken like a true veteran investor.
>>> Eunice Yoon CNBC Beijing.
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