Gold has put in a prety significant run in the short term back up to previous highs, but still below it’s 150 day moving average – a popular view on the health of gold. Here’s some data I shared with my clients on the what we’re seeing for gold:
You can look at option activity as somewhat of a sentiment indicator showing fear and euphoria. When traders pile into one side of any market, the market tends to move to the other end of the range.
We are getting close to a level where I would consider taking profits or even positioning short for a move back down towards lows. Obviously this is a short term speculative trade, so adjust position size accordingly. And wait for the price action to reverse, as everything still looks very bullish here. But once it does reverse I do expect the action downward to be sharp.