This market's huge up day after such a sell-off yesterday has me thinking of poor exasperated Charlie Brown. The consensus explanation is that the market was surprised by the better than expected 3.5% GDP growth for the third quarter, but I don't think anyone really understands this market. What this volatility really shows is the general level of anxiety among traders; it takes very little to start either a bullish run upward or a panic for the exits. The lesson for us mice to avoid being squashed by the elephant stampede is old fashioned risk management: have a plan; follow your plan; and always have stop loss orders in place.

RUT ran up almost $14 to close at $580 while the SPX ran almost $23 to close at $1066. The SPX move was particularly strong and broad based across industry groups, which is why I decided to remove my hedge position on the Dec condors. But I certainly don't believe we are out of the woods yet. This is a scary market (and Halloween is coming!).

I sold the two Jan $510 puts I purchased yesterday to hedge my Dec iron condor for $11.50 (loss of $260) when the deltas of my short Dec $510 puts returned to 16. This left the P/L at +$200, delta = +$7 and theta = +$63. Make sure your stops are in place and be especially disciplined in this market.