BRIAN BELSKI: The S&P 500 May Go To 1900 Now That The Fed Has Spoken

The new target implies 5% upside from today's levels around 1,714.

"Sometimes bull markets have a mind of their own, and this one is no different," Belski wrote in a note to clients. "Furthermore, lackluster bond market performance, coupled with expansive equity gains, will likely spur renewed fund flows into equities, especially as the calendar flips to 2014. Thus, we believe the S&P 500 could reach a potential peak of 1,900 before the economy catches up."

Belski called the Fed's decision to not taper its asset purchasing program a "game changer." Indeed, after the Fed announced the decision on Wednesday, the stock market immediately shot to new all-time highs.

But reality will eventually catch up to to the momentum, says Belski (emphasis added):

Frankly, the current rally in stocks has had more to do with liquidity-driven momentum versus fundamentals, and the lack of asset alternatives has only added to market strength. Eventually the Fed will have to alter its stance once the economy shows stronger signs of life. Until that time, fundamental headwinds will be perceived as positives, while underlying macro strength will be momentum daggers and party crashers.

Therefore, the more stocks rise, the greater the likelihood of a sharp price reset once the Fed decides to start taking away the punch from the bowl. Nonetheless, our work shows that such monetary policy transitions, while painful initially, have typically benefitted stocks longer term.

"Now that tapering appears to be off the table for the time being, we are inclined to invoke an adage that we have learned to live by throughout our careers - do not fight the Fed," Belski concludes.