Last Wednesday's huge bullish run seems like a distant memory. Last week, it appeared that the markets believed that the bulls' party would continue, but that seems far away. Now traders worry about a weak economy and the Greek tragedy in Washington - remember those Greek plays we read in school? All manner of terrible calamities occurred and usually most of the characters had either been murdered or committed suicide in the last act of the play. Our politicians remind me of those Greek plays; it is depressing.

SPX closed down $4 at $1697 and RUT gained $3 to close at $1075 - somewhat unusual to see those indexes disconnected. Trading volume was flat to slightly up with 2.1 billion shares of the S&P 500 stocks trading; this is just slightly over the 50 dma. Trading volume on the NYSE increased 4% and also increased 4% on NASDAQ. Volatility popped back up yesterday with the VIX hitting 14.7%, but closed today at 14.1%. After closing at a new all time high last week, SPX has now fallen back below the August highs and may even have the 50 dma at $1680 in its sights. SPX has given up almost 2% in only four trading sessions. RUT has fared much better, still holding above the August highs and posting a gain today. If RUT is still leading the markets, perhaps I should be encouraged by today's strength in RUT?

The Case Schiller Housing Price Index increased 12.4% in July, up slightly from last month's 12.1% increase. The Conference Board's consumer confidence report came in at 79.7 for September, down from 81.8. So the housing market continues to turn in encouraging numbers. Some of that should filter out into the economy at some point as construction picks up, but it will be a slow process. A large number of foreclosed homes remain either on the market or being held by banks. The recent tick up in interest rates is probably slowing the real estate markets a bit, but interest rates are still very low historically. I bought my first house on a 9.5% mortgage, so rates around 4% look pretty good to me.

My Oct iron condor on RUT consists of 910/920 put spreads, 1110/1120 call spreads and 1130/1140 call spreads. The 1110/1120 calls were the original position from August 22, but I rolled up half of the contracts to 1130/1140 today. The current P/L is -$680 or -4% on 20 contracts with delta = -$91 and theta = +$114.