Just before the open this morning, the futures were deep in the red and trading started fast and furious downward. It appeared to be a continuation of yesterday's flight to cash. SPX broke through the lows set on May 6 ($1065) and even the low set in February at $1057 before rebounding as high as $1090. The markets staged a strong rally into the close in the last twenty minutes - a bullish sign going into a weekend when you might expect caution to rule. RUT closed at $649, up $9 and SPX rose $16 to close at $1088. Financial stocks led the market's gains, based on both the German Parliament approving the Greece bailout plan as well as the US Senate's passing of a financial reform bill, removing some of the associated uncertainty. Trading volume was high, but not too much higher than yesterday with a 10% increase on the NYSE and flat on NASDAQ; over 7 billion shares of the S&P 500 stocks traded today, slightly up from yesterday.

A piercing candlestick pattern was displayed on both the SPX and RUT charts today. Today's candle did not extend (or pierce) more than halfway into yesterday's black candle, which would be the strongest reversal signal, but it was significant. But this market has been prone to sudden and wide swings back and forth, so one has to be very cautious about assuming a reversal is signaled. However, one sign that yesterday was the end of the correction was simply the extremely dire tone that was universal on all of the financial news programs yesterday. Everyone I heard on CNBC was insisting it was going lower and going to get worse before it improved.

I closed the 790/800 call spreads of my June RUT iron condor this morning for $0.15, but I didn't roll the calls down. I decided it was wise to take a little bit of a "wait and see" attitude before rolling those spreads downward (my recent scars are tender). So now I am just holding the 580/590 put spreads and am about $2k underwater; but if I do nothing more and these put spreads expire worthless, I will be up about $2k. I will look for an opportunity to open new call spreads next week.