The markets traded upward once again today, but trading volume dropped across the board - not as bullish as it might appear. SPX gained $11 to close at $1173 and RUT closed at $692, up $12.  Trading volume in the S&P 500 stocks was down to 3.2 billion, down from yesterday and further below the 50 dma. Trading volume declined 4% on the NYSE and was down 3% on NASDAQ. The SPX chart is trapped in the range of $1120 to $1220. When one analyzes the various issues worrying the market (European debt, US debt and the lack of political courage to deal with the problem, intractable unemployment, etc.), it is hard to imagine any quick fixes. Therefore, range bound trading may be our environment for some time. Directional trading has to be very short term; Jeff Macke refers to this as a "Wolf Market": not bullish, not bearish, requiring the successful trader to trade in and out quickly. Directional trading is never easy, but when the "trend" is a matter of a few days, directional trades are particularly challenging. In this environment, trading delta neutral is very attractive. But the rub here is knowing how to adjust the trade as the market swings rapidly back and forth.

My September iron condors on RUT are cruising into expiration for a nice profit (13% and 17%). All of the spreads are in excess of two standard deviations OTM, so the probabilities of these spreads expiring worthless is very high. The Oct RUT iron condor stands at a P/L of -$2,600 with delta = -$57 and theta = +$128. The short calls have deltas of about 17 so we are close to requiring an adjustment if the market continues upward.