The SPDR Gold Shares (NYSEArca: GLD), iShares Gold Trust (NYSEArca: IAU) and ETFS Physical Swiss Gold Shares (NYSEArca: SGOL) and other gold-related exchange traded products have recently been solid performers, even amid some dollar strength, and that strength is luring options bulls to some gold funds.

Gold is seeing greater support from safe-haven demand after currency devaluations across Asia added to investment demand for a better store of value than paper currencies or stocks and bonds. Bullion was recovering lost ground after dropping to a five-year low last month on concerns that the Fed would hike rates as early as September. Obviously, a rate hike for 2015 can now only happen in October or December.

Although precious metals ETFs have recently displayed some strength, gold is still in a lengthy bear market, giving some traders pause about how much more near-term upside the yellow metal has in store. [Doubters in Gold Rally]

GLD, the world’s largest ETF backed by physical holdings of gold, has added nearly $1 billion in new assets since the start of August and the fund is also drawing bullish options bets.

“Calls on the fund’s shares rising above $125 by mid-January, up about 12 percent from its current level, represent the biggest block of open interest in the fund’s options with 86,000 contracts open,” reports Reuters. “Data from Commodity Futures Trading Commission last week showed that speculators raised their net long position in gold futures by 32,725 contracts to 82,546 contracts, highest since mid-May.”

“Gold has regained its shine in recent months, but that doesn’t change the dull outlook for the precious metal over the longer-term, warns Goldman Sachs, which sees prices falling to $1,000 in 12 months as the Federal Reserve normalizes monetary policy,” reports CNBC.

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