Central Banks Buy Gold

North Korea Adds Tension To Market While Central Banks Buy Gold

Gold continues to hover close to the $1,600.00 an ounce level, as the price to invest in the precious metal traded nearly flat on Friday gaining 0.01 percent or $0.10 to close at $1,596.00 an ounce, while posting the first monthly gain in several months. The price to invest in Silver eased just one cent to close at $28.31 an ounce, while the Gold/Silver ratio, the number of ounces of Silver it takes to buy one ounce of Gold, inched higher to 56.37 as Silver under-performed Gold.

"We see physical buying by the retail investors during price dips and this helped to support the prices [and] should go up above $1,600. If everything goes well, it seems like Gold could move on to a higher trading range. Gold should test $1,620.00," said Brian Lan, of Gold Silver Central Pte Ltd. "We are in an uncertain market. Normally a strong PMI data from China would tend to draw investors towards stocks and not support Gold prices, but this time we see a reverse. The North Korea tension is adding to the market uncertainty,"

Meanwhile, central banks have been buying up Gold bullion at the rate of 27 metric tons each month, according to Edel Tully of UBS.  Russia and South Korea have emerged as the two biggest Gold buyers, but there are several smaller global central banks that are actively buying the yellow metal and that's bullish for Gold. Central banks have only been net buyers of Gold since 2011, after 20 years of being consistent net sellers of bullion, according to the World Gold Council (WGC).

Whenever official sector buying is confirmed, just the fact that central banks are involved in the Gold market helps to stabilize prices. Last month Gold prices began to surge on March 15, just as the Cypriot banking crisis erupted when the exchange rate fell apart between the greenback and the euro. The euro ended up losing around 1.5 percent against the dollar in March, while bullion gained nearly the same amount.

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GOLD CURRENT TRADE

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Our Position 

Bought 1Apr Gold on 25/03/2013

Entry: 1592

Stop  : 1578

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SILVER CURRENT TRADE

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Our Position 

Bought 1May Silver on 01/04/2013

Entry: 27.90

Stop  : 27.30

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TO BUY OR SELL GOLD OR ANY OTHER INVESTMENT VEHICLE LISTED. 

 Do your own due diligence. 

No one knows tomorrow's price or circumstance. 
 I intend to portray my thoughts and ideas on the subject which may s be used as a tool for the reader. 
I do not accept responsibility for being incorrect in my speculations on market trend. 

 King Regards