The markets bounced back a bit this morning, but were very volatile all day. SPX set a new low for the past few weeks at $1102. The major market averages had pulled back to their starting points by the time the FOMC report was released. It is hard to say what the market's early reactions to the report were, given the extreme volatility all afternoon. But the last hour of trading was decidedly bullish. SPX closed up $53 to $1173 and RUT gained $45 to close at $696. One surprising aspect of the FOMC announcement was language to the effect that interest rates aren't likely to rise until the middle of 2013; it is very unusual for the Fed to issue a time line for interest rates. This was probably their attempt to calm the markets. Trading volume remains high, but it did pull back a bit from yesterday's highs; 6.8 billion shares of the S&P 500 traded today; trading volume was down 4% on the NYSE and down 5% on NASDAQ.

My Aug and Sept condors continue to struggle in the midst of this market turmoil; both positions are underwater. I removed the put hedges today; those gains are crucial in giving both of these positions a shot at profitability; in fact, the Sept condor could make a larger than normal profit. But who knows what is going to happen at this point? All we can do is trade what the market gives us.