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Gold Trader Bets $1M on Massive Price Crash
29 Apr
Summary
- Gold prices are steady as dollar firms and oil impacts rate cut hopes.
- A trader sold upside calls and bought downside puts in GLD.
- The two-pronged trade aims for big gains if GLD drops 15% by July.
Gold prices held steady on Thursday, influenced by a firmer U.S. dollar and elevated oil prices that dampened hopes for imminent interest rate cuts. In a noteworthy market maneuver, an options trader has placed a substantial bet against the SPDR Gold ETF (GLD).
This trader implemented a sophisticated two-pronged strategy by selling upside call options and simultaneously purchasing downside put options on GLD. The transaction generated a significant credit of one million dollars. The bet is positioned for substantial gains if GLD’s value plummets by at least 15% before the July 17 expiration date.
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