Gold risk reversals show bias for continued strength over three months

Gold's options market is pricing continued strength in the yellow metal over the next three months. 

Three-month risk reversals on gold (XAU3MRR), a gauge of calls to puts, has risen to 1.75, the highest level since March, according to data source Reuters. In other words, the bullish bias for gold is strongest in four months. 

A positive number indicates demand for calls or bullish bets is stronger than that for puts or bearish bets. 

Gold prices surpassed the previous lifetime high of $1,921 reached in September 2011 and were last seen trading near $1,930 per ounce, representing an 8% month-to-date gain. The yellow metal has gained over 25% so far this year.  

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