Markets rejoiced Wednesday after the Fed announced sooner than expected tapering. Both the Nasdaq and S&P 500 put in powerful bullish outside days. The S&P 500 got the better of the Nasdaq today rising 1.7% bouncing right off precise 50 day SMA support. The Nasdaq which recovered almost 100 handles from its intraday low to high gained 1.1%. Volume expanded. For now at least the tapering (just put some tape over my mouth if I use that word again) can be perceived as a good situation, of course this is the first day. May it be the indexes like the notion of more free market principles back at work? Will it be a sell the news scenario? I do not know, you do not know either, so lets stop pretending we do. All that matters is the price action. Technically we know the averages have enjoyed a robust year. Companies themselves have been feeling more rosy than many believe as mergers continue at a decent pace. Is it because they see real value or is it they fear tapering will raise the cost of cheap capital (mouth taped)? Some more confusing action in important individual names Wednesday. Groups imperative to economic expansion are housing and autos. Even before the afternoon jump, builders were already in good spirits after LEN reported earnings. The stock jumped 6% and reclaimed its 200 day SMA that was bothersome in both September and October. It has actually looked better since June as it began to round out its bottom. F on the other hand fell 6% losing its 200 day SMA after a year end update.

This article requires a Chartsmarter membership. Please click here to join.