Gold rally could be similar to 1980: Trader

Options Action: Bullish bets on gold

Gold bugs are finally getting a bid.

Prices of continued to rally Thursday, rising more than 1 percent to a four-week high as uncertainty over a possible Fed rate hike had investors piling into the safe haven asset. The precious metal is now up more than 6 percent from the recent low hit in late July and some traders think now could be its time to shine.

Read More Gold at 1-month high after Fed hints Sept rate hike is less likely

On Wednesday, when options volume in the SPDR Gold ETF, the , ran 1 ½ times its daily average, one trader bet nearly $250,000 that the ETF could continue to rally over the next two weeks. Specifically, that trader bought nearly 12,000 of the Sept. 4 weekly 112-strike calls for 20 cents each. Since purchasing a call option allows a trader to buy a stock, or in this case ETF, at a certain price for a given time, this is a bullish bet that the GLD will rise above $112.20 by Friday, Sept. 4.

"The is one of the first times in a while that we've seen options traders bet on a rebound," Mike Khouw, a CNBC contributor, said Wednesday on CNBC's "Fast Money."