It's amazing to watch the SPY go flying up and down based on every little word the politicians are uttering today. We are in that most uncomfortable of places……….the no man's land between the upper and lower extremes. I've trimmed my SPY puts by about 2/3rds and my OIH puts by only about 10%. Otherwise, I'm holding strong. You can refer to my watch lists on the right at any time to see all my positions.

This is beautiful on the SPY.

The big question, of course, is whether to hold over the weekend. Because on Monday, it's either Deal or No Deal, with the implications thereof. I'm inclined to stick with my SPY position until a possible wipeout on the SPY.

A good morning so far. OIH is one streaming chart I watch constantly, and – – in spite of gold's strength – – it's terribly weak. In fact, it's down more than any of the big equity indexes. As long as we hold below 171.54, I am staying with this short. A break below 143.65 (the horizontal line you see below) would mean a big break down. I also accept the possibility that we may just be starting to form the right shoulder of a gigantic head and shoulders pattern, and if so, the breakdown of this chart won't happen until next year.

I was up again early this morning, just to be fully prepared for the day ahead. Equity futures have been down pretty hard all through the night, with the S&P down about 20 points as of this writing (90 minutes before the opening bell). It was only a week ago today that the same market was up about 60 points based on the excitement over taxpayers getting saddled with a trillion dollars in debt to forgive Wall Street's misdeeds. Time and events sure do move fast in these markets.

In fact, that swift movement is probably is what is making things so interesting right now. Congress, bless its heart, chose not to rubber-stamp a 2.5 page memo handing the reigns of the country over to Paulson. So now it's a game of chicken. On one side you're going to continue to hear the breathless warnings about how the economy will collapse into a protracted recession unless the plan is passed; and on the other, you will have those who want to consider alternatives first (while nervously eyeing daily events, such as the collapse of the largest S&L in history last evening).

Comments reflect the rapid deterioration in focus. We used to talk about individual stock picks; then we started talking about politics (since that dwarfs earnings these days in driving stock prices, RIMM notwithstanding); and now we're talking about what kind of containers can be purchased at Target to store cash. I'm just waiting for folks to break out in discussion about the right ammo to buy.

The challenge, as always, on mornings like this is whether to take profits or let things run. I am feeling very good about the positions I am in, so I have no intention of making an exit. I have only one index position (70 in-the-money November puts on SPY) and perhaps I'll sell 20 of those early just to take some profits off the table. Anyway, I'm going to take advantage of my early awakening and read the paper. Good morning to you all.

OK, they're not exactly turning police cars over, but this is a pretty awesome protest.