The bulls continued their buying spree today, primarily fueled by Microsoft and Amazon earnings reported last evening. SPX hit a new all time high, closing at $1760, up $8. But RUT was trading much weaker all day and managed to recover somewhat in the afternoon to close down $1 at $1118. The VIX declined a tenth of a point to 13.1%. Trading volume dropped off with 2.2 billion shares of the S&P 500 stocks trading. Trading also dropped 4% on the NYSE but volume increased 10% on NASDAQ.

SPX chopped sideways and somewhat lower all morning, but then strengthened to close the day on a nice gain. But small and mid-cap stocks, as measured by the Russell 2000 Index, weren't leading the big cap stocks as they have all year. RUT traded in the red all day, but managed to recover most of that loss by the close. If you are following the talking heads, purported gurus are coming out of the woodwork to warn of an impending crash. And it is true that the markets are high and overbought by many measures. One interesting plot showed total stock margin is nearing its all time high; at the beginning of the last two major bear markets of 2000 and 2008, margin had peaked as traders enthusiastically went "all in". But, it is also true that markets can trend longer up or down than considered rational by market analysts. The take away for most of us is simply to be cautious as we chase stocks higher.

My November iron condor on SPX stands at a net P/L of -$3660 or -18% with position delta = -$70 and position theta = +$171 on 20 contracts. Time decay is ramping up for this position and will erase much of these losses, assuming the index doesn't trend too strongly. But this trade will be a small loser, even in the best scenario. My adjustments and hedging to date have chewed up all of the potential profit.

Have a nice weekend.