The market traded down at the open this morning, then chopped sideways before beginning a slow climb upward to close at new 52 week highs. The sovereign debt problems in Europe appeared to color the opening mood, but new home sales posted a 27% rise in March and that report, along with continued positive earnings announcements, appeared to fuel the gains. RUT ran up almost $8 to close at $742 while the SPX closed at $1217, a gain of nearly $9. Trading volume was down 8% today on the NYSE and down 13% on NASDAQ. Trading of the S&P 500 dropped back to just above its 50 day moving average. The earnings announcements continue in earnest next week; the Case-Schiller housing price index will be reported Monday and the FOMC will announce their interest rate decision Tuesday. Those are the next significant pieces of economic news that may move this market.

My RUT May iron condor started with 20 contracts at 590/600 and 750/760; about a week ago, I rolled the 590/600 puts to 650/660 and half of my 750/760 calls to 770/780. Today I rolled the balance of the 750/760 calls up to 770/780. The June 750 call hedges remain in place. The overall position now stands at a P/L of -$1600, delta = -$27 and theta = +$80. The June hedges are up over $1600 and rolling the puts upward added $1300 in gains. That is why this position is only $1600 underwater at this point with the RUT advance of the past several weeks.

Several people have asked me recently if trading the iron condor is no longer appropriate for this market. It is certainly true that the RUT index is too volatile for condor traders at the moment. But that conclusion is based on the rear view mirror. If I were in the predictions business, I might choose a different index to trade. But the essence of my trading philosophy is to react to what the market does today, not to predict the market's direction or speed of movement. Any rules that require me to predict which index is best this month, or predict whether I should sit out this month, are simply inconsistent with my trading strategy. This strategy has worked well for me through the good times and the bad times in the past. Success is not measured by never taking a loss. Success is achieving net positive gains over the long term.