Options traders are turning more bullish on gold and silver ETFs as the precious metal funds battle key resistance.
“SPDR Gold Shares (NYSEArca: GLD) call buyers appeared for the second straight session as the ETF met some resistance on its 200 day moving average, peaking at $164.89 a share yesterday before giving back some recent gains,” said Street One Financial’s head of ETF/options sales and trading Paul Weisbruch in a report Wednesday.
The bullion fund was up 7.4% year to date heading into Wednesday’s action, but slipped about 1% in afternoon trading.
Gold ETFs are flat for the week after rallying Monday following comments from Federal Reserve Chairman Ben Bernanke on unemployment and the U.S. economy. [Gold ETFs Test Resistance]
“Options flows in another metal, iShares Silver Trust (NYSEArca: SLV), have been decidedly leaning more to the ‘bull’ side in recent sessions as well with the presence of call buyers, however volumes have not been astounding,” Weisbruch noted.
“SLV, like GLD, has run into some resistance recently around its moving averages, notably bumping up against its 50 day moving average yesterday before giving back some gains and quickly reversing,” he added.
The silver ETF fell Wednesday but is outperforming gold with a gain of 17.2% so far this year through Tuesday’s close. [Silver ETFs Stall]
SPDR Gold Shares
Full disclosure: Tom Lydon’s clients own GLD and SLV.