In my opinion, this is an extremely bullish development for gold investors. Simply put, there is less and less gold in the major Western vaults. What is more, these vaults comprise the lowest amount of gold since many years.
Let me discuss two vaults: COMEX and SPDR Gold Shares (GLD).
The chart below shows the number of ounces of gold held at COMEX as "Registered Category". These ounces of gold are the basis for futures transactions carried out at COMEX. On May 8, 2015
there were 407,402 ounces of gold registered at COMEX. This is a very small number - similar quantity was registered at the end of January 2014 (439,900 ounces) when a strong move up in the gold prices was beginning.
To be even more precise, open interest in gold futures is currently standing at around 41 million ounces of gold, which means that the investors / speculators take part in a play where the total bet of 41 million ounces is covered by just 407 thousand ounces of "real" gold (1%). This can end very badly if even a small group of players wants their gold to be physically delivered. Because there is practically no gold in the registered category vaults, only higher gold prices could fill the gap between demand and supply. But even then I am not sure whether the vault is filled with enough gold.
Similarly to COMEX, the GLD vaults comprise less gold. Please, look at the chart below:
It is easily spotted that today there is the smallest amount of gold in the GLD vault since the end of 2008, when the last bottom in the gold prices has been established.
These two developments are, in my opinion, very bullish for the gold bugs.