Covered short on Gold

I'm not a gold bug.  Unlike oil, which people use whether they want to or not, gold is generally a optional purchase.  Certainly there are some industrial uses for gold, but at over $1000 an ounce people are pretty motivated to use as little as possible, or develop alternate solutions. So I'm not that impressed with the long term prospect of a big pile of metal locked somewhere in a fortress that is expensive to hold, doesn't generate dividends, and doesn't create value.

I think the current rise is a speculative bubble--but knowing when it will burst is always a challenge.   I'm very willing to give up any up-side on gold, in order to make money on the downside.  I sold GLD short at 114.44 and bought 108 Dec calls at 7.08 for a net credit of 107.36 per share.  If gold continues its upward trend I can only loose .64 maximum per share, but if things turn-around the trade will turn profitable well before the 108 level is reached.   In retrospect I probably would have been better just buying 109 Dec puts, but for some reason I have always felt more comfortable with calls.