Evidently central banks, including our own no doubt, like a weak dollar. So with markets on edge, central banks stepped-in with rumors of intervention against the rising dollar. This led to a reversal in stocks as a weak dollar has been supportive to U.S. stocks. (This, ladies and gentlemen, is done while articulating a strong dollar policy.) But, stocks were oversold anyway so a rally was due as we suggested Wednesday. Let's not forget quad-witching is at hand Friday to put a bow on a volatile week.

The 3 PM rally in stocks occurred just after rumors rallied the euro. You see the banksters don't really have to do anything just float the idea.

Overall economic news continues to be dreadful. While Jobless Claims improved somewhat the data shows they're still quite high. The Housing Data, while an improvement, was still not robust especially considering the season and interest rates. But the worst data was the Philly Fed report which printed at -7.7 vs expected readings of 9.0. It's been said this is the worst 3 month drop " ever" in that index.

Commodities were stable while bonds were mostly unchanged.

Meanwhile the Fed keeps chucking the POMO in there and this is building on the trading desks of Primary Dealers. A note of caution to bears; beware the double POMO action slated for Monday.

"Getting out while the getting's good", was the battle cry for insiders at Pandora (P). Its IPO came to market at $16, hit $26 and closed underwater at $13.26. This is sort of like the aftermath of LNKD ($68) and GM ($28.50).

Stocks did find their mojo with the euro rally and joined the party. Volume for the day was heavy but breadth remains negative which enhances some oversold conditions heading into quad-witching.

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