A relief rally of sorts finds already altitude sick bears gasping at “Dow 21,000!” in Wednesday’s broad-based climb higher. For its part the SPDR S&P 500 ETF Trust (NYSEARCA:SPY) finished up 1.38% at an equally menacing or euphoric all-time-high intent on betting the ranch at Mar-a-Lago — and that this time is really different.

Wednesday was (mostly) all about investors and a few bears caught in the cross-hairs, embracing an on-message, less combative and some might say, almost presidential Donald Trump following his first address in front of Congress.

As for particulars, there really weren’t any. The POTUS was vague on economic details about how he’s going to make America great again, but subdued protectionist rhetoric and maybe the absence of a bullet aimed at healthcare and biotech stocks, likely helped investors re-price their expectations.

Also supportive, investors are growing increasingly okay with a transparent Federal Reserve readying the market for a gentle third nudge of interest rates since December 2015. The latest hint of a raise came from Fed President William Dudley on Tuesday stating an increase has grown “a lot more compelling.”

The narrative of an economy chugging along, as well as wider and beneficial interest rate spreads for America’s banking institutions, helped the influential financial sector to an outsized and relative strength gain of 2.61%.

Leading the way for the Financial Select Sector SPDR Fund (NYSEARCA:XLF), Bank of America Corp (NYSE:BAC) and Warren Buffett’s Berkshire Hathaway Inc. (NYSE:BRK.B) climbed by 3.6% and 3.27% respectively.

As for that next rate increase, traders have quickly ramped up the probability of a 0.25% hike in March from 35% to 77.5% when the FOMC concludes its two day meeting on March 15.

Snap Inc. (SNAP)

Elsewhere, some investors may have refrained from Wednesday’s festivities in order to keep the proverbial powder dry for Thursday’s much ballyhooed initial public offering of Snap.

Snap, the mobile text and message sensation with grand plans to move into other highly competitive markets has been priced at $17 for investors fortunate enough to have been allocated shares before they begin trading on the NYSE under the ticker “SNAP.”

And for those other investors? Remember that for every Facebook Inc (NASDAQ:FB), there are many other less attractive investments like Twitter Inc (NYSE:TWTR) and Groupon Inc (NASDAQ:GRPN) which had equally big plans to disrupt but have proven much more consistent at losing shareholder value.

Unusual Options Action

One spot which unsurprisingly failed to be lifted during Wednesday’s rally was the CBOE Volatility Index, or VIX. The notorious fear gauge fell by 40 cents or 2.94% to finish at 12.50%.

By historical measures, the VIX remains firmly optimistic that the good times will continue for equities. However, short-term and when assessed relative to its 10-day simple moving average, sentiment hasn’t grown so bullish as to warn of overly complacent market behavior.

Financial Select SPDR ETF (XLF)

One of Wednesday’s largest trades was a three-way spread in XLF. With the financial services ETF at $25.10, the 31 March $24 call, May $27 call and May $23 put were put up 50,000 times.

Similar open interest in the weekly March contract suggests the closing of the call and whose proceeds were used to finance a longer-dated position in May in XLF.

Without having information as to which contracts were actually bought and sold, what’s my guess as to what transpired. I’d wager a bull is banking profits on a long XLF call position and rolling the proceeds into a bullish reverse fence for a hefty net credit with little risk of breaking the bank, barring a sizable market correction.

As of this publishing, investment accounts under Christopher Tyler’s management do not maintain positions in any of the securities or their derivatives mentioned. The information offered is based upon Christopher Tyler’s observations and strictly intended for educational purposes only; the use of which is the responsibility of the individual. For additional market insights and related musings, follow Chris on Twitter @Options_CAT.