6 ways to trade unpredictable market

After another day of swings in stock markets Tuesday, "Fast Money" traders outlined what they deemed strong plays ahead.

Major U.S. averages closed mixed on Tuesday, holding nearly flat despite a more than 3 percent drop in U.S. oil prices. Still, the S&P 500 has fallen 8 percent already this year.

Amid uncertainty, traders looked to a wide range of sectors for upside.

Utilities

Trader Tim Seymour believes the Utilities Select Sector SPDR Fund could rise as investors look for value. The fund climbed 1.5 percent Tuesday.

A trader works on the floor of the New York Stock Exchange.
Brendan McDermid | Reuters
A trader works on the floor of the New York Stock Exchange.

Telecom

He also outlined the iShares U.S. Telecommunications ETF as a possible value play. It has fallen nearly 10 percent this year.

Small caps

The iShares Russell 2000 ETF has taken a beating this year, falling more than 12 percent. Still, Seymour said he would use it as a way to hedge his portfolio.

Commodities stocks

Shares of Freeport-McMoRan and Marathon Oil have each plummeted more than 70 percent in the last year amid low commodities prices. Trader Pete Najarian said he owns put options in both and would continue to bet against them as oil prices struggle to stabilize.

U.S. Treasurys

The iShares 20+ Year Treasury Bond ETF looks like a "no-brainer" in current conditions, said trader Brian Kelly. The fund is up about 4 percent this year.

Disclosures:

Tim Seymour

Tim Seymour is long AAPL, BAC, CLF, DIS, F, FCX, GE, GM, GOOGL, INTC, IWM, JCP, JPM, KO, LGF, RL, T, TWTR. Tim's firm is long BABA, BIDU, MCD, NKE, SBUX, YHOO.

Pete Najarian

Long AAPL, BAC, BKE, BMY, BP, DIS, DISCA, FOXA, GE, KO, MRK, PEP, PFE, he is long calls AAL, BAC, BX, CHS, GE, GDX, HAIN, LC, MSFT, NRF, WMB, WYNN, XBI, YDKN, he is long puts FCX, MRO

Dan Nathan

Dan is long WMT Feb Put Spread, long PFE buy-write, long VZ Buy-write, long XLU Feb Call Spread, long QCOM Feb Calls, long UUP, long TWTR, long TLT Apr risk reversal; he is short SPY.

Brian Kelly

Brian Kelly is long BBRY, Bitcoin, GDX, GLD, SLV, TLT, US Dollar; he is short Aussie Dollar, British Pound, CS, DB, EWH, HSBC, SPY, Yuan.