I agree. I think there will be more volatility.
I don't think the market will respond TOO much to this because, in the end, nothing has changed.
The Treasury have removed themselves from one argument in one claim in one lawsuit. The FHFA are still making the claim though, so it isn't even gone.
Even if it was gone, the lawsuit still goes on.
The market will respond when something substantial happens. We've had too many non-events for most investors to react any more. lol.