Again, when everyone is talking about it, it is near the top. Dan Sheridan has two trade ideas, one bullish and one bearish for GLD, the gold SPDR that holds bullion.

Google Dual Calendar Spread

The July options’ implied volatility is much higher than August. After earnings the implied volatility of the near month collapses. What effect does that have on the profit graph?

Here is the profit graph of the dual calendar spread with the volatility skew.
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This is what happens if the volatility of the near month options drops to the implied volatility of the far month options.

The intermediate profit rises to the final form when the near month volatility drops. So you get an added lift from the implied volatility collapes.