Upbeat results from technology bellwethers Oracle and Research In Motion led the S&P and Dow higher Friday, however the Nasdaq was the only major index to close in positive territory for the week.
Is tech your top trade? How should you be positioned now?
Strategy Session with the Fast Money traders
If you’re looking for a trade, I’ve been saying it’s time to shortRIM , says Guy Adami. I think the stock is near resistance.
Citi analyst Jim Suva concurs with Adami’s trade. He says, “We remain sellers of RIMM & recommend using strength to reduce positions. Acknowledging solid print & guidance, we think 2010 is shaping up to be highly competitive year w/ no sign of iPhone slowdown & Android invasion kicking into high gear.”
I also don’t like RIM, echoes Joe Terranova. They had year on year declines in Canada where they’re based. And in the US they’re experiencing trouble.
I understand the point about competition, explains Karen Finerman. But the smartphone pie is getting bigger. If you’re looking to trade RIM I wouldn’t jump in and buy – but at the same time the stock doesn’t seem that expensive, either. However, when push comes to shove, I like Apple better.
I’m bullish on RIM, counters Pete Najarian. I think it’s a company that’s firing on all cylinders. And they’re aggressively getting into growth areas, such as Asia.
If you don't want to short RIM, in tech I like long NTAP on a pullback as well as Western Digital, says Adami. And I still like Oracle .
And for 2010, I’m bullish tech broadly, says Joe Terranova. I’m very jazzed by the potential of the PC upgrade cycle.
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RETAILERS SNOWED IN?
Investors are closely watching the 5-day financial forecast with a wicked winter storm threatening to dump as much as 2 feet of snow in parts of the northeast. Considering this is the last weekend before Christmas, how should you play retail?
Super Saturday Snow
% Of Stores That Could See Snow Tomorrow
Kohl's 40%
TJ Maxx 36%
Macy's 35%
Target 31%
Wal-Mart 29%
Source: Planalytics
What’s the trade?
I expect the snow will have a big effect on the holiday shopping results, says Joe Terranova. But shoppers could gravitate to cyber space. Personally, I’m bullish Amazon into Q1 of 2010.
FedEx was up a little on Friday as the possible beneficiary of more cyber sales, says Karen Finerman. You could order online and still get delivery by Christmas.
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DOLLAR DOMINATES THIS WEEK
The US dollar seemed to dominate headlines this week, with concerns about the debt of other nations triggering a flight to quality.
And the dollar is likely to extend gains in the upcoming week, continuing to draw support from growing signs of a stable U.S. recovery as well as a Federal Reserve plan to wind down most of its emergency lending early next year.
What’s the trade?
I expect to see the correlation between stronger dollar and weaker stocks to break down, says Joe Terranova. Going forward don't be surprised to see the strong dollar bouy the market.
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CALL OF THE DAY: MORGAN STANLEY
A forecast from Morgan Stanley suggests the bank is betting on higher rates next year.
According to Greg Peters, Morgan Stanley head of Global Fixed Income, "Our call for the end of 2010 is 5 and a half percent 10-year, which is very much out of consensus, but rates seems too low particularly given the economic strength."
What’s the trade?
I’m short the long-end of the Treasury curve because I also think rates will go higher, says Karen Finerman. You can play it with either the TBT or the TLT .
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PROTECT AND PROSPER IN NEW YEAR
With only 8 trading days left in 2009 it’s high time to think about 2010. And Jim Iuiro of TJM is anything but bullish on the early part of next year.
Considering the dollar ETF is up around 3% this month, and because lately a stronger dollar has led to weakness in the S&P, he expects to see the market decline in January.
In an environment where the dollar/ equity relationship is breaking down and the economic recovery appears weak, he suggests the following trades.
Iuorio’s Ways To Play
Short Financials
Buy General Mills (GIS)
Buy Unilever (UN)
Buy Canadian Dollar (FXC)
Buy Australian Dollar (FXA)
To learn more about these trades, check out our interview with Jim Iurio at the end of the Word on the Street video.
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Trader disclosure: On Dec. 18th, 2009, the following stocks and commodities mentioned or intended to be mentioned on CNBC’s Fast Money were owned by the Fast Money traders; Adami Owns (AGU), (BTU), (C), (GS), (INTC), (MSFT), (NUE); Pete Najarian Owns (M) Calls; Pete Najarian Owns (MS), Is Short (MS) Calls; Pete Najarian Owns (UUP) Call Spread; Pete Najarian Owns (MRVL); Finerman's Firm Is Short (IJR), (MDY), (SPY), (IWM), (UNG); Finerman Owns (AAPL); Finerman's Firm Owns (BCR), (M), (MSFT), (NOK), (TGT), (WMT); Finerman's Firm Owns (BAC) Preferred, (BAC), (BAC) Call Spread; Finerman Owns (BAC) Preferred, (BAC); Finerman's Firm And Finerman Own (WFC) Preferred; nerman's Firm And Finerman Own (FLS)
For Joe Terranova
Terranova Works For (VRTS)
Terranova Is Chief Market Strategist Of Virtus Investment Partners, Ltd.
Virtus Investment Partners Owns More Than 1% Of (CLB)
Virtus Investment Partners Owns More Than 1% Of (DLR)
Virtus Investment Partners Owns More Than 1% Of (EXR)
Virtus Investment Partners Owns More Than 1% Of (IGE)
Virtus Investment Partners Owns More Than 1% Of (XLY)
Virtus Investment Partners Owns More Than 1% Of (DBV)
Virtus Investment Partners Owns More Than 1% Of (UA)
For Jim Iuorio
Iuorio Owns (FXA) Calls
Iuorio Owns (SH), Owns (SDS) Calls, Is Short S&P Futures
Iuorio Owns (GIS)
Iuorio Owns (UN)
Iuorio Owns (EWC)
Iuorio Owns (FXA) Calls
Iuorio Owns (FXE) Calls
For Brian Stutland
Stutland Owns (GLD), Is Short (GLD) Dec. Call Spread, Owns (GLD) Jan. Put Spreads, Is Short (GLD) Jan. Calls
For Liz Dunn
Thomas Weisel Partners Or Affiliate Has Managed Or Co-Managed A Public Offering In Past 12 Months For (CACH), (ULTA), (LULU)
Thomas Weisel Partners Or Affiliate Has Received Investment Banking Compensation In Past 12 Months From (CACH), (ULTA), (LULU)
Thomas Weisel Partners Or Affiliate Expects To Receive/Seek Investment Banking Compensation In Next Three Months From (ANF), (ANN), (CACH), (CWTR), (ULTA), (LULU)
Thomas Weisel Partners Is A Market Maker In (CACH), (CWTR), (PSUN), (ULTA), (URBN), (LULU)
Thomas Weisel Partners Or Affiliate Has Provided In Past 12 Months Or Is Providing Investment Banking Services To (CACH), (ULTA), (LULU)
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