SPX appeared to be rallying a bit this morning after opening at yesterday's close and trading higher. But any relief was short-lived. SPX closed at $1378, down $17. RUT followed suit, losing $11 to close at $794. Trading volume dropped form yesterday's highs but remained above the 50 dma with 2.9 billion shares of the S&P 500 trading. Trading on the NYSE dropped off 13% and also fell 9% on NASDAQ.

Today's price action took SPX through its 200 dma at $1381 and there was no rescue by the bulls. SPX closed at its low for the day. RUT broke through its 200 dma yesterday, and at least on my chart, broke through the lower edge of the trend line I had drawn on RUT since mid-September. Today's market levels take us back to roughly late June or mid-July on the broad market averages. We are still well above the low of the market back in October of 2011, but we are giving away this year's gains very quickly. SPX is now only up 9.5% for this year.

The talk on the street focuses on political gridlock, higher taxes, more regulations, and upcoming recession. I didn't foresee it, but there was a lot of hope for change built into the pre-election market prices.

My Nov condor stands at a P/L of +$2,200 (+13%) with delta = +$76 and theta = +$212. The Dec position stands at a P/L of +$980 (+6%) with delta = +$28 and theta = +$61. I will apply my two sigma time stop to the November position tomorrow. Unless this market bounces, I may be closing the Nov put spreads.

Where is the bottom?