April 30, 2013 -- Renewed demand for physical gold bullion and an attractive valuation on the precious metal seem to be giving a solid bottom to gold’s recent volatility, CNBC reported.

Yesterday, in the story “Down on Gold? Here's Why You Should Be Buying” the news outlet highlighted gold’s strengths.

Last week saw the precious yellow metal rally three percent based on a surging demand for the metal. This is demand differs from previous demand because it is all focused on the physical gold bullion itself, rather than the gold backed funded that were became popular with investors in recent years. Investors in those funds bought paper gold, namely they owned a piece of the fund that held the gold. However, these investors weren’t taking possession of the precious metal itself.

CNBC reported that even though gold’s future is uncertain in the near term, it remains very solid when viewed as a longer term investment.

One analysis suggests that even though the near term remains somewhat murky, the longer outlook remains solid.

"Depressed price levels were perceived as an attractive entry point by physical buyers and bargain hunters," ETF Securities said. "The longer-term fundamental outlook for gold has not changed and appears robust in our view, despite the sharp falls seen in recent weeks."

In 2013, investors have pulled almost $11 billion out of the high-profile SPDR Gold exchange-traded fund, according to Index Universe. That’s more than twice the amount that’s been pulled out of any fund.

Gold dropped dramatically in mid-April following months of some slow declines and minor increases. But with the new playing field seemingly set, demand for gold is expected to rise from other corners.

"Frenzy among coin and jewelry buyers from the U.S. to China and India was behind the recovery of the gold price last week," reported ETF Securities.

“Jewelers and consumers in India reportedly paid a $10 per ounce premium as the festival and wedding season approaches and demand for jewelry increases,” reported CNBC.

Shanghai Gold Exchange volumes hit record highs during the week, while long positions increased 33 percent, ETF Securities said.

Gold remains a controversial investment given its unpredictable nature over the past several months. Many analysts attribute the demand to reflect a long-term confidence in the precious metal.