It seems like yesterday that everyone was in a panic about the European debt problem, but that has been solved now (do you hear the sarcasm?). Merkel and Sarkozy were reported to have pledged their support to a bank bail-out plan and that news seemed to be enough to send the bears running for cover. However, we know nothing about the plan that will eventually be approved and there are many possible pitfalls - so don't think everything is just wonderful and start buying everything in sight. But today's price action was strongly bullish, except for lower trading volume. SPX sliced right through the 50 dma at $1176 to close at $1195, up $39 on the day. Another bullish sign was SPX trading strongly in the last hour to close at the high of the day. RUT closed up $29 at $685. This is just below the 50 dma at $689. Trading in the S&P 500 was down to 3 billion shares, well below the 50 dma at 4.0B. Trading volume was down 24% on the NYSE and was down 25% on NASDAQ. There was no significant economic news today and nothing much is scheduled for tomorrow either. So the market will be especially sensitive to any news or rumors, because the traders who were buying last week and today will bail at the slightest provocation. The VIX dropped to 33% today but that is still historically high, so remain cautious. This is not your daddy's market!

My Oct iron condor on RUT stands at -$804 with position delta = -$60 and position theta = +$294 (20 contracts). The Oct 560/570 put spreads are over two standard deviations OTM while the 740/750 call spreads are only one standard deviation OTM. My Nov iron condor on RUT stands at +$860 with position delta = -$33 and position theta = +$78 (20 contracts).