Today was another dismal day in the markets, but the losses were relatively minor. RUT closed at $599, down about $3; SPX closed at $1044, down about $6. RUT was down as far as $596 before afternoon buying pared some of the losses. Let's consider RUT as we look at the "correction or consolidation" question (the same analysis holds for the S&P 500). If RUT were to drop back to its closest support level at about $585, that would represent a 6% drop from recent highs. Most market observers would say a 10% drop constitutes a correction. Of course, this isn't a science - maybe 6% will constitute the correction this time. But the conclusion is clear: so far, we have some minor consolidation going on, nothing too alarming. Next week is loaded with economic reports: consumer confidence, ADP payroll, final Q2 GDP, Chicago PMI, etc. Assuming no huge surprises in any of those reports, we will probably just muddle along here for a while.

My Oct condor now stands at P/L of -$1,100, delta = +$20 and theta = +102 (great theta/delta ratio, but unfortunately, this trade is badly wounded as it limps home). Our Nov condor is barely out of the gate but is in good shape so far with P/L of +$20, delta = -$13, and theta = +$68. The trades I publish here in my blog are in one $50k account, and it is worth noting that you can also manage a larger account containing several trades with the Greeks just as we have with these individual condors. This overall account stands at a P/L of -$685, delta = +$17, and theta = +$147. So we come to the same conclusion either way we look at the trades - everything is fine; no adjustments are necessary. We are just watching the time decay.