The fiscal cliff play continues. This may turn out to be a classic Greek tragedy for those of you who remember those plays from high school. In any case, many traders started to worry seriously today that maybe a deal wasn't forthcoming anytime soon. The markets opened roughly at yesterday's close but traded down from there. SPX closed at $1430, down $14, but traded as low as $1423 before recovering somewhat. RUT lost $5 to close at $848. VIX inched up a bit to 17.8%. Trading volume was up on this expiration Friday with 3.7 billion shares of the S&P 500 stocks trading. Volume was up a whopping 115% on the NYSE and increased 48% on NASDAQ.

The fact that SPX bounced back from its intraday lows was positive, but one has to wonder how much of the recent price increase in the market will be sold off once a fiscal cliff deal is struck. Or will a huge bull market erupt on the news? That is hard to predict. It appears to me that 2013 will be a tough economic year regardless of the deal ultimately reached in D.C.

Durable orders increased 0.7% in November, not quite as robust as October's 1.1% rise, but not too bad either. The University of Michigan Consumer Sentiment indicator dropped to 72.9 from 74.5 - not too surprising given all of the drama unfolding around the fiscal cliff. Some of the surveys I have seen suggest most people don't even know what is involved in "going over the cliff", they just infer from all of the media attention that it must be Armageddon.

SPX settled at $1433.59 and RUT settled at 846.02 so the puts of my December condor expired worthless, leaving the Flying With The Condor™service up 19% on the year. We beat the S&P 500 at +14%, but I gave away a lot of my gains over the past few months.

Trading hours will be cut short on Monday and the exchanges will be closed Tuesday.

Enjoy the holiday with your families. Merry Christmas.