A few things here -
First, today's snapback rally was one of the more predictable of the last few years. We talked about the setup for it yesterday. Everyone was too negative and stocks had dropped too far too fast. Oversold conditions were obvious by mid-week and by Friday they had gotten totally carried away - all ten sectors in the S&P were trading at two standard deviations or more below their 50-day moving averages. That's a collapse and an unjustified one at that.
Second, this can continue so long as the headlines coming out of Washington remain conciliatory and the most vocal opponents of higher taxes start to just get used to it and get on with their lives. Markets will be benign in the absence of shouting.
Third, in the end it won't matter so long as the only strong segment of the economy is housing. In the absence of momentum outside of housing, Q4 estimates probably still have room to come down. This puts a leash on how far equities can go, we've just seen that phenomenon at work after the June-September run.
Like clockwork, the rally into year-end camp will be back out today, emboldened by the screens o' green. They're adorable.
When in doubt, stay long quality and use rallies to pare back the stuff that needs global growth to work. It's too early to be there.