A massive trade just happened in gold. The options market is buzzing
Twenty minutes after the market opened Monday, someone sold almost 116,000 420-strike calls in the SPDR Gold Shares ETF (GLD) expiring Sept. 18.
TL;DR
- A large options trade on the SPDR Gold Shares ETF (GLD) indicates a potential end to gold's current rally.
- The trade involves selling in-the-money calls and buying out-of-the-money calls, creating a net credit and a bearish bet.
- This transaction runs counter to the prevailing bullish sentiment in most other GLD options flows.
- The trade occurs ahead of significant macroeconomic events, including inflation data and the Jackson Hole Economic Symposium.
- Gold has been rallying despite rising interest rates, which typically negatively impacts non-yielding assets like gold.