The Fed's quantitative easing is aimed at longer-duration Treasury securities and mortgages, but the 10-year yield actually slipped Friday, to 2.89 percent, close to where it was before the Fed's announcement Wednesday. Meanwhile, the 5-year yield rose to 1.68 percent, its highest level since mid-September.
"I think it will go a little bit further," said David Ader, chief Treasury strategist at CRT Capital. "There's no great new information on what's happening with the back end outperforming. This is a position unwind in relatively illiquid conditions."
Knapp said the market was beginning to price in faster tightening, though the Fed is not expected to begin raising short-term rates until 2015.
"The [stock] market's already all in on the fact that growth is getting better," Knapp said. "The growth outlook has improved, and that's definitely good news, but there's a monetary policy reaction function associated with it."
He has forecast that the S&P will be at 1,900 by the end of 2014 but expects stocks to hit a rough spot early in the year as the market reacts to Fed tapering.
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"All this room everyone thinks the Fed has—they don't have as much room as people think," Knapp said. "The story for next year will be the market will tighten ... no matter what the Fed does."
Inflation could rear up if the economy continues to expand, he added, forcing the Fed's hand sooner. Some in the gold market also think that might be the case, even though the metal has been pounded in a low-inflation environment.
Gold lost 2.5 percent for the week and is now 28.2 percent lower for 2013, its first down year since 2000 and its worst performance in more than three decades.
"Inflation will be encouraged by central banks to an extent, as we are under the 2 percent target today," George Gero of RBC wrote in an email. "Their continued money-printing will take its toll, as higher wages [and] higher union demands both here and abroad, coupled with better economic figures, may encourage forward pricing by corporations of materials."
Friday's report of third-quarter GDP was the latest positive piece of economic news. Growth was revised up to 4.1 percent, the first above 4 percent and best-performing quarter since fourth- quarter 2011.
"There's such good news on the economy, and I'm really encouraged about the 2014 outlook," said Knapp, who now expects companies to show better revenue growth than they've been reporting in recent periods.
Joseph LaVorgna, chief U.S. economist at Deutsche Bank, said the third-quarter number could mean that fourth-quarter growth will be even better than the 3 percent he expects—a forecast that's already more bullish than average.
"The numbers are looking really good," he said. "On the GDP, the upward revision was all in demand."
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The third-quarter growth forecast was for it to remain at 3.6 percent, but gains in consumer and business spending pushed it up.There had been a lot of skepticism about the third quarter, as it was inflated by a big inventory number, and the concern was that there would be a giveback for that in the fourth quarter.
"Now that you have better sales, it makes the inventory numbers look even better because producers are building the inventories in anticipation," LaVorgna said.
The most important numbers for GDP in the week ahead are the personal income and spending, expected to show a 0.5 percent gain, he added.
7:00 a.m. Richmond Fed President Jeffrey Lacker on CNBC's "Squawk Box"
8:30 a.m. Personal income/spending
9:55 a.m. Consumer sentiment
Stock market closes at 1 p.m.
Bond market closes at 2 p.m.
8:30 a.m. Weekly jobless claims
—By CNBC's Patti Domm. Follow here on Twitter