SPX easily broke through the 50 dma and closed at $1820, up $20 on the day. The 50 dma also coincided with resistance set by the highs back in late November and early December, so breaking that level so convincingly was significant. RUT gained $10 to close at $1129. Volatility continued to decline with the VIX closing at 14.5%, down almost a full percentage point. Trading volume increased today, further underscoring the upward move. About 2.3 billion shares of the S&P 500 stocks traded today. Trading on the NYSE increased 11% and trading volume on NASDAQ increased 10%.

RUT corrected more strongly than SPX, so it is still well below its 50 dma at $1139. From peak to trough, RUT corrected 8.4%, as compared to a 6.1% correction on SPX.

FOMC Chair Janet Yellen made her official debut with Congress today and generally portrayed herself as in line with Bernanke's policies; she didn't appear to be signaling much change to the current path of the Fed. She said that the current slow reduction in the Fed's stimulus programs will likely continue, barring no significant economic deterioration.

Now the question is whether the markets will simply run back up, break through the earlier highs, and continue the bull market run? That seems unlikely, given the weakness of the economy, but there I go again with rational analysis. This sharp "V" pattern of  a sudden market decline followed by a sharp recovery reminds me of the several pullbacks of 2013. Last October, SPX dropped 5% in 15 trading days; the current decline took 14 days. In October, it only took six days to recover all of those losses. Today's close on SPX represents a recovery of 73% of the losses in this pullback in only four days. This just proves once again that it is hard to keep up with this volatile market (price volatility, not implied volatility). If you feel like this market is jerking you around, you aren't alone.