It seemed like the markets were just trading sideways yesterday and this morning, waiting on the FOMC announcement this afternoon. Bernanke surprised traders by saying the economic recovery has stalled, but remained committed to the stimulus programs in progress. In fairness, Bernanke said this pause in the recovery is temporary, but I don't think the market was expecting him to even suggest the recovery was pausing. Of course, the announcement that 4th quarter GDP has contracted by 0.1% was a surprise. This was the first contraction since the 2nd quarter of 2009. Analysts were expecting an increase of 1% following the 3.1% rise in the 3rd quarter. Perhaps Bernanke felt it necessary to take a more negative tone in light of this GDP number. As a reminder, economists consider two sequential contractions in GDP as the basic definition of a recession. Hmm...

SPX closed down $6 at $1502 and RUT closed at $897, down $10. VIX increased a point to 14.3%. The fact that the markets didn't drop more than they did underscores the strength of this market. A key measure of this market's resilience will be the jobs report Friday. ADP reported an increase of 192k in private payrolls for January, up from the previous +185k. Maybe that indicates a positive non-farm payroll number. Earlier this week, the Conference Board's consumer confidence survey reported out at 58.6 for January; this is the lowest reading since November of 2011. The recent peak was in October at 73.1. Trading volume dropped off from yesterday with 2.6 billion shares of the S&P 500 trading (the 50 dma = 2.5B). Trading on the NYSE was flat and trading volume was up 2% on NASDAQ.

My Feb condor on RUT stands at a net P/L of +$560 or +3% with delta = -$61 and theta = +$156 on 20 contracts. The theta/delta ratio is back in line, but if the bullish trend resumes, it will be a race to expiration. With 15 days until expiration, each day bleeds out a fair amount of time value, but a few powerful gains in the market might push me to close the position. We are getting a little short on time to be hedging. We'll see.