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Halftime Report: Uncertainty Challenging Market

Tech traders are keeping an ear turned west for news out of California-based Apple. The keynote for the firm’s developer’s conference gets underway this afternoon, and traders want to know about a new iPhone, new software and a new Steve, writes The New York Times.

Apple's shares have risen about 17 percent in the past two weeks, compared with a 5.7 percent gain in the Dow Jones Industrial Average during the same period.

INSTANT INSIGHTS WITH THE MONEY TRADERS

We’ve seen a great run in Apple, explains Fast Money trader Joe Terranova. I want to hear what they’re going to do next. In terms of the price action, I’d digest what they say for the next 10-14 days.

I agree with Joe, adds Jared Levy of Peak 6. Buy on rumors and sell the news is a big story with Apple. It tends to work.

I see plenty of reasons to own this stock, adds Jon Najarian of OptionMonster.com. But we’ve had a nice run. However, if Steve Jobs shows up the stock could pop 6% from where we are now.

Patterns in the charts suggest to me that the risk is to the downside, counsels Dan Fitzpatrick of StockMarketMentor.com. I don’t see a catalyst but I’d also be a buyer lower.

OIL, COMMODITIES LEADING THE PULL BACK

Oil slipped toward $68 a barrel on Monday as a stronger dollar prompted a retreat from last week's seven-month high above $70. Oil often moves lower as the dollar makes gains.

The dollar rose against a basket of currencies on Monday extending sharp gains made late last week as U.S. Treasury yields rose to seven month highs, prompting investors to cover short-dollar positions.

What’s the trade?

A lot of markets reversed intra-day on Friday, explains Joe Terranova. That suggests the re-introduction of uncertainty and it’s challenging the market. I’m especially interested to see how the Treasury auctions are received this week.

It seems to me the bond market is already telling us that rates are going up, muses Jon Najarian. I’m watching the TBT and the EUO, he adds. If I’m reading the moves correctly it could mean crude oil is heading a lot lower.

I disagree with Jon, counters Joe Terranova. The action in the dollar places oil in a stalled position. But I don’t think investors should step in and sell the energy sector. If the dollar rolls over then I expect oil to continue its march higher.

I wouldn’t be buying the dollar here, counsels Dan Fitzpatrick. I’d watch and wait for it – because I think it’s going to peak out. Then I’d be a seller.

PALM PLUNGES AS PRE LAUNCHES

Analysts tempered their enthusiasm for Palm Inc.'s Pre smart phone, which went on sale this weekend, with limited supplies of the device and a relatively small number of software applications drawing concern.

What’s the trade?

They sold out but they didn’t have that many units to sell, explains Pete Najarian. Now investors want to know if Palm can keep the momentum

TRADE TO GO

Ahead of the Treasuries auction, Joe Terranova suggests reducing your positions. With so much debt coming onto the market, wait and see how it all plays out, he counsels.

This Week’s Treasury Auctions

Security Amount

Monday 3 Month Bills $31B

6 Month Bills $31B

Tuesday 3 Year Notes $35B

Wednesday 10 Year Bonds (3 1/8) $19B

Thursday 30 Year Bond (4.25) $11B


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