There Is No Oversupply Of Gold And Silver Bullion Now

New York (June 13)  Last week the SPDR Gold Shares Trust (NYSEARCA:GLD) tested its local resistance at $123.0 (look at the red, horizontal line on the chart below):

The result was negative - GLD did not break above. However, in my opinion, the big picture is still supporting higher gold / silver prices. Here is why I think so.

US Treasuries

Last week big speculators once again cut their net long positions in 10-year Treasury notes futures (a decrease of 46.1 thousand contracts). In my last article on gold I have noted that the precious metals market is losing the support from the Treasury futures market. Last week's developments confirm this thesis but investors should keep in their minds that big speculators still hold a large net long position in 10-year Treasury notes (212.1 thousand contracts, as of June 6). In other words, ahead of the incoming FED meeting and despite smaller bets on higher Treasury prices (and lower market interest rates), the general sentiment among big traders in Treasuries is still positive (for Treasuries and the precious metals market).

SOURCE: Reuters