SPX opened this morning and plunged as low as $1646 before bouncing and closing near its opening at $1656 for a one dollar increase on the day. RUT traded a little more bearishly, closing down $4 at 1043. RUT opened at the 50 dma that it broke yesterday, but it couldn't hold that level and fell to $1039 before rebounding to close at $1043.

Trading volume increased to 2.4 billion shares of the S&P 500 while trading on the NYSE decreased 2%. But trading volume on NASDAQ increased 8%. Volatility pulled back a bit as the markets bounced; the VIX closed down one point to 19.6%. This is still a high level for volatility, so don't take a nap yet. And there is no sign that Obama will soften his refusal to negotiate; so increased volatility may be with us for a while.

The FOMC minutes from the September meeting were issued today. The minutes revealed a lot of debate over whether or not to taper stimulus - not too surprising. Many members believed the economic data had not yet reached the goals previously set by the committee, while other members wanted to soften the goals and declare the economic data were "good enough". Markets hit their lows around 11 am ET and then traded up close to the intraday highs by 2 pm when the FOMC minutes were released, so the minutes had little, if any, effect on the markets. One might be tempted to credit the news of Yellen's nomination as the market-turning event, but that news was out yesterday, so that doesn't track. But it is true that markets will take some calming effect from Yellen's nomination. Many analysts believe Yellen is likely to continue Bernanke's dovish policies, and perceive this as bullish for the markets.

With a market this nervous, attempts to rationalize its behavior are largely futile. I will go crawl back into the cave.