The markets roared off to a very bullish start to the new year this morning. SPX tacked on $19 to close at $1277 and RUT closed up $11 at $752. SPX closed above resistance at $1270, a very bullish sign. But SPX bounced off resistance at $1285, the high set in November. Trading volume changes from Friday are not very instructive since trading volume was so low last week. But it was interesting that volume in the S&P 500 did not quite get to the 50 dma at three billion shares - not so bullish a sign.

The Dec ISM Manufacturing Index rose a bit in December to 53.9 (was 52.7 in November). Construction spending rose 1.2% in November. Several analysts cited these reports as the reason for the bullish rally, but this data doesn't seem to be that impressive. The FOMC minutes were released this afternoon, but there wasn't much news there. Some FOMC members believe additional Fed accommodation will be required to boost the economic recovery.

I closed the RUT Jan 770/780 call spreads today; assuming the 670/680 put spreads expire worthless, this will result in an $800 gain on 20 contracts or a 7% gain. But that assumes this rally continues; we'll see. The Feb iron condor on RUT stands at a P/L of +$760 with delta = -$32 and theta = +$87. So now we watch and see if this rally has legs. I have my doubts.