There was some good news buried among "Fed-watching" Wednesday.

New Home Sales for example rose 10.8% which is a good number obviously but does that follow the Fed interest rate increase perhaps stimulating a "buy-now" attitude?

Secondly, and perhaps most important was news Russia is willing to discuss oil production declines with OPEC. Since imploding oil prices have been at the center of stock market declines, this is considered a positive development. But, one kernel of hope doesn’t a deal make given the attitudes of the would-be participants. On that score, oil prices rallied early Wednesday despite a massive 8.6M barrel increase.

Bulls suggested the price increase was due to the usual refrain—“…it could have been worse”.

Naturally, the Fed Meeting result was mostly an expected outcome. Surprisingly while stating labor market growth remains um, “solid” the concern was wage growth remains weak. That admission led the Fed to reduce what they termed “full employment” to 4.9% vs estimates over 5% due lower wage growth.

The Fed also stated the goal of 2% inflation has been difficult to achieve given the “transitory” effect of declining oil prices. I love that transitory crap which they’ve been asserting since oil was over $70.

The Fed implied through Fed mouthpiece WSJ’s Jon Hilsenrath, they’re worried about “financial market turbulence and slow overseas economic growth”. So, it’s about the markets after all.

Stock markets reacted negatively thinking the statement wasn’t dovish enough in addressing economic realities.

I still believe markets could rally to S&P 500 1902-1956 from the previous low of 1812 set January 20^thgiven oversold conditions. We closed just two days later at 1906.

Goldman Sachs has argued that 4 issues remain to keep markets higher which include: Month-end pension rebalancing; Majority of corporations exiting their buyback blackout window next week; A reduction in equity supply; and, severe oversold indicators. That may work for a short-term rally or not. But from above we did hit the lower end of our projected top.

The Fed likes to say U.S. manufacturing declines are primarily the result of a stronger dollar. I would strongly argue this weakness is due to global economic weakness and the Caterpillar (CAT) sales result indicates.

 Market sectors moving higher included: Crude Oil (USO), Gold (GLD), Gold Stocks (GDX), Oil & Gas Equipment (XES), Russia (RSX), Brazil (EWZ), Regional Banks (KRE), Banks (KBE) and Volatility (VIX).

Market sectors moving lower included: Everything else.

Below is the heat map from Finviz reflecting those ETF market sectors moving higher (green) and falling (red). Dependent on the day (green) may mean leveraged inverse or leveraged short (red).

No, nobody has a good forecast as to what lies ahead. If the past 4 days of trading is any guide, we should rally 200 points on the Dow and that would be followed by 200 points lower on Friday. Just sayin’.

More economic data on Thursday includes Durable Goods Orders, Pending Home Sales and Jobless Claims. Then Friday is the GDP Report, Employment Cost Index, Chicago PMI, Consumer Sentiment and Baker-Hughes Rig Count.

Let’s see what happens.