It was yet another day of the "fear of the rally" rally.

Players who were caught short and with their pants down continued to get squeezed.

It was risk-on mode in both equities and in credit.

The primary bond new issue pipeline kicked into high gear with several large bond deals coming to market although liquidity for secondary bonds remains challenging.

Even new bond deals that were priced tighter (rich in price terms) than comparable bonds in the secondary markets ripped tighter in secondary trading as investors deployed cash reserves that they have been sitting on.

In a move that was expected Slovakia came through with their EFSF (European Financial Stability Facility) vote.

The FOMC (Federal Open Market Committee) minutes confirmed that the Federal Reserve may want to leave open the option of a new Quantitative Easing program.

Players are scared to fight the balance sheet of the ECB (European Central Bank) or the Fed for that matter.

Treasury bonds gave up ground as stocks gained (there was also new supply in a Treasury bond auction) and the Euro gained against the U.S. dollar to close at 1.38.

Corporate earnings will kick into high gear with both JP Morgan, a bellwether of financials, and Google reporting earnings on Thursday.

That being said, we are not out of the woods yet.

We have simply stumbled upon an open clearing in the middle of a vast forest.

Initial jobless claims numbers are out on Thursday and most players will be watching corporate earnings.