It was a little difficult to understand why the market plunged on the basis of the tensions in the Ukraine, and it was just as odd to see the market rally so strongly one day later. SPX shot up $28 to close at $1874, a new all-time high. RUT also closed at a new all-time high at $1209, up $32. And volatility collapsed, with VIX shaving off 2 points to 14.1%. Trading volume was not as strong as those gains might have suggested. Trading in the S&P 500 stocks was basically flat at 2.2 billion shares. Trading volume was up modestly on the NYSE at +4%. But trading volume was up strongly on NASDAQ at +17%.

RUT is now at the top edge of its Bollinger bands; SPX is close, but not quite at the upper edge. Of course, stocks and indexes often track along the upper or lower edge of the Bollinger bands for several sessions. The bottom line is that all signs are bullish, but one has to acknowledge that the market is edgy and ready to head for the exits on any negative news. I have to admit that I don't understand the strength of today's rally. We didn't have any economic news today, but tomorrow will be different with the Fed's Beige book, ADP employment numbers, and the ISM services index. It's hard to predict what this market may do with those reports. Is bad news still good news because it means the Fed will stay involved? We'll see.