With so many unprecedented and hefty considerations, markets might enjoy today's complete absence of scheduled economic data as some sort of chance to seek its own equilibrium.  That sentence was actually lifted from an article we wrote in July 2011 when European drama was first beginning to collide with impending Fed policy changes.  The first four days of the week contained plenty of events informing both of those heavy hitters and markets attempted to reconcile those versus the decreasingly significant scheduled econ calendar.  

Back then, we thought that the data-less Friday looked like a decent opportunity for markets to "trade it out," but as it happened, things didn't move too much until two weeks later when 10yr yields dropped about 60bps in 5 days in the run up to NFP.  Interestingly enough, today's data-less Friday is followed by a relatively inconsequential week, just like last time.  And wouldn't ya know it, the following week ends with NFP Friday.  But before we get too far ahead of ourselves drawing parallels to the past, we should be clear in saying the following:

It doesn't make any sense to try to get ahead of the market right now.  If you "just knew" that European turmoil would eventually catch up with markets and back in late February/early March that the April government changes in Greece were "sure" to land the Euro-zone right back in the center of market drama, then you win, but the question is: "what now?"  And that's a question no one can rightfully answer.

 There are some great "probably's" out there, but ultimately, a lot depends on uncertain variables in the near term future.  There was a poll today indicating that the PRO-bailout crowd was back in the lead in Greece.  If they do win elections in June, it would probably un-do a lot of the recent rally.  

Then there's the matter of domestic Fed Policy to contend with.  Y'day's minutes and today's disproportionately large reaction to Philly Fed numbers speaks two things: a)The Fed is ready to move either closer or further away from stimulus and b) markets smell that blood and have assumed that it's the impending economic data that will push that decision-making process in one direction or the other.  Simply put, you didn't see the big nasty volume spike y'day on the Philly Fed Index, you saw a big nasty volume spike on a clue that makes it seem increasingly likely that QE3 isn't going to be a 4 letter word in June.