With the Fed meeting on Tuesday, Gold stocks are enjoying some nice gains today. There seems to be some investors scaling back into gold with December and January call options.
Barrick Gold (ABX, $33.39, up $2.07)
December 35 call (ABXLG, $0.80, up $0.50)
January 35 call (ABXAG, $2.70, up $0.95)
Goldcorp (GG, $30.38, up $2.43)
December 30 call (GGLF, $1.65, up $0.95), or 135%
January 30 call (GGAF, $3.50, up $1.27), or 57%
Gold Fields (GFI, $9.87, up $0.67)
December 10 call (GFILB, $0.50, up $0.30)
January 10 call (GFIAB, $1.30, up $0.30)
Newmont Mining (NEM, $38.50, up $2.66)
December 40 call (NEMLH, $1.00, up $0.65)
January 40 call (NEMAH, $2.85, up $0.95)
I also wanted to warn some of you about NovaGold Resources (NG, $1.33, up $0.56). The stock is getting a tremendous amount of action as the company scrambles to raise $20 million. The deadline is December 29 and it will be interesting to see if NovaGold will survive.
Although gold could be set to rebound, the price has dropped because of the U.S. dollar’s recent strength. Gold typically acts as a hedge against the U.S. dollar which makes Tuesday’s FOMC meeting all the more important as to the direction we go from here.