GLD - Time to Enter LEAP position?Gold has been retracing but several factors lend to a good place to establish a January 2022 LEAP call option position. First off, price has found previous support at the .328 Fibonacci retracement level and looks to be retesting on a monthly basis. Holding this support level would be extremely bullish in my work, on a long term level. Should price break below, there still remains a solid upward channel line in place. So one might have an even better price level later. This is accumulation phase here so don't get discouraged. This is not a short-term trade.
The channel projection, should it hold, indicates that price should be between 180 and 225 by the January 2022 LEAP expiration date. Assuming that the lowest price we will see GLD at the expiration date is 180, one can buy the 170-220 call spread, pay 10 or less, and feel certain that one can achieve a break even since at 180, the 170 call would be valued at 10.
One never knows how these things play out but with ever increasing fiat currency debasement worldwide, gold prices should be much higher. My last look at usdebtclock.org showed that there are $34,000 dollars out there for every ounce of gold. That being said, owning the physical for long term security always seems to be the best option. But for those who like to play the paper side as well, this seems to be an interesting play to consider.
(not financial advice, just a trade that I'm going to put on and my rationale.)
