Italy's latest bond auction further reinforced the traders' concerns over European debt with bond yields reaching 6.5%. The dollar strengthened against the Euro and US stocks dropped again today, although on only slightly higher volume. SPX closed down $14 at $1212 and RUT lost $10 to close at $708. Trading volume in the S&P 500 was slightly up at 3.2 billion shares, still below the 50 dma. Trading volume was flat on the NYSE and up 2% on NASDAQ.

No significant economic data were released today, so the fears about the European debt crisis leading to a global recession appear to be driving the pessimism.

My Jan iron condor on SPX stands at a P/L of +$1,980 with delta = -$2 and theta = +$49, on 20 contracts. The theta/delta ratio is strong; in fact, I am tempted to close this position early and lock in a nice gain. Hmmm.. My directional trades are being run over by this market as my delta neutral trades are making money. It makes a good case for diversifying your strategies.