The markets opened up in positive territory this morning, buoyed by rising retail sales numbers for October. But the markets ran into the headwind of a rising U.S. dollar, strengthened in response to concerns over a potential EU bailout of Ireland. The major indexes traded largely sideways most of the day, but managed to stay in positive territory until the last hour of trading, when the bears took control. The SPX closed at $1198, down $1 while RUT closed at $720, up $1. The support level around $1200 on the SPX appears to be holding thus far in this correction, although it broke slightly below $1200 in the last 15 minutes of trading today. Trading volume of the S&P 500 stocks fell below the 50 dma to 3.2 billion shares. Trading on the NYSE was down 16% and was down 14% on NASDAQ. 

Consumer spending rose 1.2% in October but the Empire Manufacturing Index came in at -11.14, while analysts were predicting +11.7. This is the first negative decline of this measure of manufacturing activity in New York state since mid-2009. With the Fed's plans for another round of quantitative easing taking heat both domestically and internationally, one has to wonder if the markets are simply pricing in less quantitative easing?

My Nov condor position only consists of the 600/610 put spreads at this point; assuming they expire worthless, this position will result in a loss of $4,281 on 20 contracts. While a loss is always disappointing, we managed to constrain the loss to approximately a normal month's gain. In this way, we can maintain a positive return longer term. The Dec iron condor stands at a P/L of +$740 with delta = +$14 and theta = +$113. This position has a maximum potential gain of $4,900 since we rolled the original put spreads from 590/600 up to 660/670. My long positions in AAPL and GOOG are still holding support, but are on the edge of being stopped out by this pull back.