Positive economic data out of China and cooling of the rhetoric about Syria gave the market reasons to trade higher today. SPX gained $12 to close at $1684. RUT traded upward as well, closing at $1056 for a $10 gain. VIX dropped a little over one point to close at 14.5%. And these gains occurred on higher trading volume with 2.2 billion shares of the S&P 500 stocks trading; trading increased 15% on the NYSE and increased 8% on NASDAQ.  Strong increases on higher trading volume are good signs for the bulls.

SPX gapped open upward this morning and sliced through resistance at $1680. Yesterday's trading broke out above the 50 dma, and today's trading left the 50 dma in the dust. If one draws a trend line on SPX from mid-November of last year to the present, touching all of the pullbacks except the low on June 24, then we won't be back on that bullish trend until around $1710 on SPX. If SPX peaks and pulls back before reaching $1710, beware of the head and shoulders reversal pattern that will result.

This is a light week for economic data. Not much happens tomorrow and then Thursday brings the unemployment claims. Friday is the heaviest day this week with retail sales, the PPI and the University of Michigan Consumer Sentiment report. Now that we have Syria out of the way, the news will probably start to focus on the debt ceiling and spending arguments. Allow me one observation on the debt ceiling debate: if my son were spending more than he earned and he hit the credit limit on his credit card, the solution wouldn't be to raise the credit limit on his card.

As you consider any new trades based on this bullish euphoria, remember that the FOMC meeting and announcement are next week. September 18 is likely to be a volatile trading day.

My Sept RUT condor position continues to be very strong with P/L of +$2,360 (+14%) with position delta = -$4 and position theta = +$59. Even with RUT's recent strong push upward, the Sept 1120/1130 calls are over two standard deviations OTM.

The higher price volatility of the past few months has many traders feeling a bit paranoid. I see the very bullish signs on the charts, but I still fear some surprise coming out of left field. I will go see my shrink, lie down on the couch and talk about my childhood. Or maybe it would be cheaper to have a glass of wine with dinner and go to bed early. We'll see if those bulls can hold this position.