Gold risk reversals flip for calls
Gold calls are claiming higher implied volatility premium than puts for the third straight day, indicating investors are adding bets to position for strength in the yellow metal.
One-month risk reversals (XAU1MRR), the cost of swapping equally out-of-the-money puts and calls, flipped in favor of calls on Tuesday, as the metal rose more than 4 percent, extending Monday's 3.7% price gain.
Investors turn offensive amid stimulus rally, Gold hangs onto majority of this week’s gains
Gold is paring some of yesterday’s gains but that shouldn’t last long. Gold should see strong support in the short-term come from the aggressive efforts by the Fed and friends. Central banks worldwide will likely intensify stimulus as financial markets brace for a few months of terrible economic data. Yesterday, Singapore’s GDP reading and the US jobless claims reading came much worst than expectations and traders should get used to that trend.
Information on these pages contains forward-looking statements that involve risks and uncertainties. Markets and instruments profiled on this page are for informational purposes only and should not in any way come across as a recommendation to buy or sell in these assets. You should do your own thorough research before making any investment decisions. FXStreet does not in any way guarantee that this information is free from mistakes, errors, or material misstatements. It also does not guarantee that this information is of a timely nature. Investing in Open Markets involves a great deal of risk, including the loss of all or a portion of your investment, as well as emotional distress. All risks, losses and costs associated with investing, including total loss of principal, are your responsibility. The views and opinions expressed in this article are those of the authors and do not necessarily reflect the official policy or position of FXStreet nor its advertisers.