Awesome. This would be a perfect spot to straddle options at about 1625. One thing though. Normally the concept/theory is that when a market consolidates like this with low volatilty, the options are cheap. Yes they are compared to if it was trending. But Gold options in general now are not cheap "anytime" compared to currencies or the bonds or softs like cocoa. At the money Dec 2012 1625 Calls and Puts are around $6000 give or take a couple hundred.

But for someone with a nice account might be a nice opportunity. On a monthly chart, this all looks like a big continuation pennant. Stochs are bottoming but not turned up. I think eventually will break up above the 1900.

On a weekly though stochs are up and around 50. MACD has some bullish divergence and On balance volume didnt drop very far on the downward action. Open interest declined on low volume the last few months. Sounds like an up coming up. May have a final small down to complete a wave first.

But an equal number of Puts and calls at 1625 or maybe 3 Calls to 2 Puts. Whatever happens is going to break out enough that either way is going to make someone happy.

Btw...I'm more of a smaller potatoes type guy. These are too expensive for me. But this is the type of pattern/look that I look for to trade. Did this in Feeder Cattle in 2011 with 135 Puts and Calls. Just as an example, "slightly" out of the money calls and puts in Feeder cattle are about $1,000. You could by a few each way and play more of a ratio of preferred puts/calls vs "insurance" puts/calls such as 4 to 1 if you bias is really one way. All for the price of one Gold Option Just a perspective.

Happy Trading!