Pay Attention to the Options Market

Qassim Suleimani was killed by the US goverment. This will not doubt enrage millions of Shia around the world who view him as a war hero. The Iran goverment will view this as an act of war.  Having said that, on November 30th I posted about the $1.75 million dollar bet. I stated the following:

Around noon in New York Wednesday, 5,000 lots of a gold option giving the holder the right to buy the precious metal at $4,000 an ounce in June 2021 changed hands. The bets were sold at $3.50 an ounce. This seems like a very aggressive position for the people who bought the call options. Insiders take positions based on upcoming geopolitical events that the general investing public is not aware of. Similar trades take place with the oil market when someone knows a war is going to break out in the middle east. This could just be a foolish bet. I don’t discount trades like this completely. It could be someone does know something.

A senior defense official told politico off the record, “We had authority before the strike to take that action”. The official did not comment whether the approval was hours, weeks or months earlier. Naturally, this is all speculation and I have no way of knowing if these two events are connected.  But leading up to today, gold had unusual price action that hinted someone knew something. It would be interesting to see the exact date the approval was given.