Throwing aside whether or not gold is in a bubble, gold exchange traded funds seem to be a crowded trade lately.

Options traders are positioning for more upside in gold ETFs by snapping up bullish call options at a brisk pace. [Options Traders Bullish on Gold ETF]

Bullish sentiment reflected in options on SPDR Gold Shares (NYSEArca: GLD) is at the highest level since early August.

On Friday, Bloomberg reported gold traders and analysts are the most bullish in at least seven years as the Eurozone debt crisis continues to heat up. Investors are buying the metal as the quickest pace since the summer, according to the report.

Gold prices were working their way back toward $1,800 an ounce following a brief foray above that level earlier this week.

“The major risk is that a sharp decline in global stock markets will lead to renewed margin calls and fund liquidations,” said Adrian Day, president of Adrian Day Asset Management, in the Bloomberg report. That may prompt “many managers to sell gold, a highly liquid asset.”