The markets opened down this morning and tried to make it back up to yesterday's bullish close, but failed; on the other hand, the bears tried to push the indexes back down to new lows, but they also failed. But the bears made another push lower during the last couple of hours of trading, nearly making it to the lows of the day. If you study the SPX chart for the past couple of weeks since this carnage began, the days where the market closed at the lows of the day are the scary days, especially on increased volume (look at last week's Tuesday and Thursday and this past Monday). But yesterday the bears pushed the market down, but could not hold those lows - that presented a glimmer of hope; but the late trading today was a bit disconcerting. The steady decrease in trading volume is hopeful, but that may be wishful thinking.

SPX closed at $1121, down $52 while RUT lost $36 to close at $660. Trading volume remains relatively high, but declined from Monday and Tuesday's levels. 6.5 billion shares of the S&P 500 traded, but this remains well above the 50 dma at 3.2 billion shares. Trading volume was down 10% on the NYSE and was down 11% on NASDAQ.

Today's market weakness appeared to stem from rumors of France losing its AAA bond rating. And that just underscored concerns about the European Union in general. After the severe losses of the past week, traders are nervous and they hit the exits without stopping to question the veracity of any rumors they have heard. I'm not criticizing; I am just pointing out one of the reasons we are seeing extreme volatility intraday in the markets.

I am continuing to adjust my Aug and Sept iron condors on RUT to avoid being run over by this market. The Aug RUT iron condor has put spreads at 600/610 and call spreads at 750/760. Its current P/L stands at about -$3,500 with delta = +$28 and theta = +$331. Both spreads are about 1.5 standard deviations OTM; at this point, we are only minimizing our losses in this position. The Sept condor consists of the 600/610 puts and the 780/790 call spreads and has a P/L of -$480, delta = +$15 and theta = +$92.

It appears as though the markets are beginning to calm down a bit, although the late trading today worries me; let's hope we don't have some significant world event/announcement that catches the markets off guard. It is a very fragile time.