The markets appeared to react negatively this morning to the downward revision of second quarter GDP as much or more than to Bernanke's remarks in Jackson Hole. But those bearish traders didn't hold sway for long; the market bounced back strongly with the SPX rising over $18 to close at $1177. RUT increased $17 to close at $692. Today's strong market was a bit surprising, given all of the bearish talk all week about Europe and the need for Bernanke to propose some kind of stimulus for the economy. The VIX spiked up to 44% this morning, but then pulled back to close at 36%. Trading volume in the S&P 500 declined to 3.4 billion shares, below the 50 dma. Trading on the NYSE was down 6% and volume was up 3% on NASDAQ.

Recent market action appears to be confirming the lows of $1120 on SPX and $650 on RUT as the bottom of this correction. But it may be early to be too sure of any conclusions here. It is a long climb back out of this hole to start talking about resumption of a bullish trend.

My Sept iron condor on RUT at 600/610 and 780/790 stands at a P/L of -$216 with delta = +$24 and theta = +$117 (20 contracts). In the course of the strong market swings of the past few weeks, I ended up with another Sept iron condor on RUT at 560/570 and 780/790; it stands at a P/L of +$1,820 with delta = +$4 and theta = +$107 (20 contracts). It may be tempting to start buying selectively at this point, but be cautious - this is a very nervous market. I strongly prefer my delta neutral trades in this environment.