Since the summer of 2015 the long gold, long 10-year US treasury bond position has basically been one and the same (silver and treasury bonds have moved in tandem as well). Investors saw gold rally from under $1100 to nearly $1400 (silver from $15 to $21) as 10-year treasury yields fell from 220 bps to less than 140 bps. As the momentum of this trade really gained steam, we saw commercial traders aggressively position themselves for gold prices (and silver prices) to decline and for yields to back up. As usual, the ‘smart’ money was correct and as Brexit came and went, we have seen gold prices fall back to around $1275 (silver has fallen to $18) and yields have backed up to 176 bps. Commercial traders have now backed off their extreme positions which could mean that the next step in the rally in gold, silver, and bond prices could be underway shortly.