The worst weekly loss since 2012 is now followed by the best daily gain since 2011. This is what volatility looks like and until shown otherwise, the low volatility environment that was seen from 2013-June 2014 is now behind us. Intermediate level volatility doesn’t necessarily mean lower prices (see 1995-1999). What is does mean is that these larger swings will likely continue into 2015.
The market is now short-term overbought but it’s coming from an extremely oversold condition (and part of the reason for yesterday’s melt-up). Expect a pause within a day or so here.