The markets opened and traded down early today and then spent most of the day trading choppily and mostly sideways. But the bulls came to the floor in the last hour and pushed all of the major indexes higher. The Russell 2000 Index traded as low as $552 in the morning and closed at its high for the day, $562.49. The Standard and Poors 500 (SPX) traded in a similar pattern and closed within a quarter of its high for the day at $1003.24. Gold closed at a six month high of $998.
Early in the day, the talking heads attributed the sideways trading to the market waiting for the unemployment numbers tomorrow morning. If that was true, someone must have decided those numbers are going to look better than expected, given the strength of the buying late in the day. The patterns of trading this week seem to suggest a fundamentally sound market and just some healthy consolidation occurring. However, I think most market players are still a little on edge from the extreme volatility of the past year. So some surprise, like a big jump in the unemployment number tomorrow, might push this market off the cliff. However, in the absence of that panic scenario, my iron condors will continue to generate profit as we consolidate sideways. My condors are in excellent shape with the Sept position at a P/L of +$2,290, delta = +$7 and theta = +$191. The Oct condor closed at a P/L of +$160, delta = -$14 and theta = +$66. So now we watch for the unemployment number and, barring no surprises, we enjoy a long weekend of time decay.