Most traders were watching for the results of the Spanish bank stress tests; they figured that was the most likely bad news that might hit today, but that news item turned out rather positively. But then the Chicago PMI came in at 49.7, down from 53.0 and the University of Michigan consumer sentiment survey declined to 78.3 from 79.2. So SPX fell as low as $1436 and then chopped sideways most of the day to close at $1441, down $6. RUT followed suit, closing down $6 at $837. If one draws the trend line below this run on SPX since early June, you will see that SPX is just bouncing along that line the past few days. A break down through $1430 would be the first warning sign that the upward trend may be in trouble. RUT appears to be a bit weaker (not a good sign for the overall market) since it is just below resistance at $840 which was where it sat after Draghi's press conference and before Bernanke's announcement. But to a first approximation, both indexes are roughly at the pre-QE III levels. The VIX rose to 15.7%, up almost one point.

All in all, the market is looking rather tentative as we get close to earnings season and we have already had several warnings from some leading companies, such as FedEx. A few poor earnings announcements could prove to be a problem for this market.

My Oct iron condor on RUT at 790/800 and 900/910 stands at a P/L of -$1,220 with delta = +$56 and theta = +$111.

Enjoy your weekend.