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The markets were trading higher until the release of the FOMC minutes from the last meeting. SPX traded up to $2061 before the release, plummeted to $2034 after the release and then recovered to close at $2048, within a few cents of being unchanged for the day. RUT gained $5 to close at $1103. Trading volume on the S&P 500 was up a bit to 2.5 billion shares, above the 50 dma at 2.3 billion shares.

The minutes from the last FOMC meeting were released this afternoon and the market turned sharply lower. The minutes revealed a general discussion of the prospect of raising the interest rates at the June meeting. This surprised traders who had been expecting the next rate hike later this year. The concern is that the economy is too weak to absorb higher interest rates. However, some economists believe higher interest rates would stimulate the housing market by encouraging banks to lend. But higher rates make capital investment more expensive for business. Capital investment has remained low in spite of low interest rates. Why? Is that because of weak economic forecasts or burdensome regulations? Now fast food businesses are starting to roll out automated order entry systems to lower labor costs after minimum wage law increases. Politicians need to refresh their understanding of the Law Of Unintended Consequences.

Our June condor position on RUT in the Flying With The Condorâ„¢ service is up 6% and the July position on SPX is up 7%. The markets continue to trade sideways. RUT is trading very close to its August flash crash levels from last year. SPX seems to be trading in the channel of $2040 to $2110.