I know I pointed out that we bounced off support yesterday, but today, SPX gains $14 to close at $1447 and RUT tacks on $10 to close at $844. What stimulated that huge move? Spanish government officials announced a new budget that will focus on spending cuts and reform. So yesterday the Greeks were rioting and Spanish bond yields went over 6%, and the market tanked. Today, Spanish officials say the right things and everything is now rosy? Good grief! How do you trade this market? My theory is that the high frequency trading algorithms are pushing these extreme market moves. The program picks up a few key words in a news story, triggers a large buy and then it snowballs. That sure makes it a stressful day for us ordinary humans trying to trade in this environment. It certainly isn't too surprising that a lot of individual investor money remains on the sidelines. Between Madoff and the computers, it's a spooky place.

Initial unemployment claims dropped to 359k, which is a move in the right direction, but all of the other economic news was negative. Durable orders dropped 13%; GDP for the second quarter only gained 1.3% on an annualized basis (down from 1.7%) and pending home sales dropped 2.6% after a 2.4% gain last month.

SPX solidly bounced off support and pushed itself back well into the upward trend band, but trading volume fell off to 2.2 billion shares of the S&P 500. Trading on the NYSE was down 16% and trading on NASDAQ dropped 1%.

My Oct condor position stands at a P/L of -$980 with position delta = +$47 and position theta = +$106.

So what happens tomorrow? Draghi is photographed frowning and the market plummets?