Markets roared Wednesday after a positive outlook on the Presidential address which was delivered Tuesday night. The series of 1% closing moves on the S&P 500 are now over as the benchmark jumped 1.4%. The Nasdaq added 1.3% and the schizophrenic Russell 2000 rose 1.9%. Perhaps the most attention should be paid to the bond market as the 10 year yield recorded a nice jump today. Looking on its chart however it is coming onto an inflection point. The 2.30 level has been support since last November and a couple more times since but it has registered a series of lower higher which it has done on three separate occasions now. This action has produced a bearish descending triangle formation and a break ABOVE in the OPPOSITE direction of which is perceived could be powerful and keep this current rotation out of bonds and into stocks persisting. The S&P 500 recorded a rare gap up as it broke above a bull flag formation today. Financials were easily the best performer today as the XLF jumped 2.8% spurred on by the likelihood of higher interest going forward. Energy seems to be picking up some steam as the XLE was the second best sector Wednesday higher by 2%. The two laggards were the staple and utilities. Retail names that reported earnings today displayed bifurcated action with LOW adding nearly double digits, but perennial laggard like AEO surrendering nearly 10% as well. Below is the chart of BBY which we were WRONG about in our Monday 2/13 Game Plan.

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