GO
Loading...

Are We Looking At A Double Top?

The bull market may turn 1 on Tuesday, but investors were in no mood to party. Monday was the lowest volume day of the year.

And our traders are closely watching developments, worried that a bearish technical signal may be forming.

What must you know?

Strategy Session with the Fast Money traders

In order for me to feel bullish, the S&P needs to close above 1155, muses Guy Adami. Personally, I think we’re nearing a top.

If you’re bullish, you absolutely want to see the market break above 1150, adds Joe Terranova. If we fail at that level we’re looking at a double top, a very bearish technical sign. But that could speak to the low volume; investors are waiting to see if the S&P can break above this level.

I thought the volume on Monday was very interesting, says Karen Finerman. Where were the investors? That could be telling.

And we didn’t get the typical mutual fund Monday inflows, adds Pete Najarian. That surprised me. 19 out of the last 23 Mondays have seen sharp inflows. But not this time.

Looking at specific stocks, if you’re in Ford, the trader in me says it’s time to take profits, counsels Guy Adami.

Or if you want a trade from the long side, I’m bullish Exxon Mobil, adds Joe Terranova.

I've got Dean Foods on my radar, adds Pete Najarian. Options action suggests the stock could go higher from here.

--------

NEW FED METRIC TO WATCH

In breaking news, CNBC’s Steve Liesman suggests there’s a new key metric for investors to watch.

According to comments from Brian Sack, the executive vice president of the Federal Reserve Bank of New York, the size of the Fed's balance sheet 'is an important policy lever for the Federal Reserve.'

The Fed will reduce the balance sheet, gradually, Sacks says, or it will risk a spike in interest rates on the long-end. And he goes on to say interest rate policy should do the bulk of the work.

Liesman interprest the rhetoric to mean the Fed will leave the size of the balance sheet alone during the earlier part of its exit startegy and let interest rate policy do the work.

What should you make of it?

I think it’s dovish, says Joe Terranova. It suggests the balance sheet is going to shrink in an orderly fashion.

--------

TECH STILL ON TOP?

Shares of Cisco led tech higher on Monday on speculation the titan was about to debut tools that will enable its network service providers to build their own high-speed networks.

Also, J.P. Morgan upgraded Cisco on Monday to Overweight from Neutral, with a new price target of $28.

What’s the trade?

If you're long Cisco, I'd take profits on the news, says Guy Adami. Or if you're looking to establish a long position in this space, I'd consider Akamai, Seagate and/ or Western Digital .

--------

BROKERS ON A BREAKOUT AGAIN?

On Monday select bank stocks appeared to be breaking out with the traders paying close attention to the action in Goldman and Citigroup .

What's the bank trade?

I'm bullish on Goldman, says Steve Cortes. I think it could be a $200 stock. Now that it's finally broken out I think it's time to buy.

Raymond James made a new 52-week high, says Guy Adami, but I still think the stock has room to run.

I'd play banks on the expectation they could go lower, says Brian Kelly. I’m short some regional banks because I see a lot of headwinds.

--------

CAN COMMODITIES KEEP STRENGTH

Oil rose toward $82 a barrel on Monday in choppy trade as a firmer dollar and improved economic optimism tugged prices back and forth.

What’s the trade?

I’m bullish Exxon Mobil, says Joe Terranova.

I’m long gold, says Brian Kelly.

If you’re in Barrick, I’d take profits, says Guy Adami.

--------


EAR TO THE WALL: DRY SHIPS

Pete Najarian has spotted unusual options activity in DryShips.

The volume of calls traded on Monday suggests to me a big investor expects something bullish, Najarian says.




______________________________________________________
Got something to to say? Send us an e-mail at fastmoney-web@cnbc.com and your comment might be posted on the Rapid Recap. If you'd prefer to make a comment but not have it published on our website send those e-mails to fastmoney@cnbc.com.

Trader disclosure: On March 8th, 2010, the following stocks and commodities mentioned or intended to be mentioned on CNBC’s Fast Money were owned by the Fast Money traders; Seymour Owns (X), (BAC); Nations Owns (MSFT), (SPY); Kelly Owns (AMZN) Calls; Kelly Owns (ELX) Calls; Karabell Owns (C), (JPM), (UYG), (AAPL), (CSCO), (DRYS), (GOOG), (GE), (IBM), (RIMM), (MON); Adami Owns (AGU), (BTU), (C), (GS), (INTC), (MSFT), NUE); Karabell Owns (C), (JPM), (UYG), (AAPL), (CSCO), (DRYS), (GOOG), (GE), (IBM), (RIMM), (MON); Jon Najarian Owns (AAPL), Is Short (AAPL) Calls; Jon Najarian Owns (DIS), Is Short (DIS) Calls; Jon Najarian Owns (DRYS), Is Short (DRYS) Calls; Jon Najarian Owns (GE), Is Short (GE) Calls; Jon Najarian Owns (HPQ), Is Short (HPQ) Calls; Jon Najarian Owns (IBM), Is Short (IBM) Calls; Jon Najarian Owns (MCD), Is Short (MCD) Calls; Jon Najarian Owns (MON), Is Short (MON) Calls; Jon Najarian Owns (MOS), Is Short (MOS) Calls; Jon Najarian Owns (RIMM), Is Short (RIMM) Calls; Jon Najarian Owns (GOOG) Call Spreads; Jon Najarian Owns (IMAX) Call Spreads; Jon Najarian Owns (GS), Is Short (GS) Calls; Jon Najarian Owns (CSCO), Is Short (CSCO) Calls; Pete Najarian Owns (MCD) Call Spread; Pete Najarian Owns (AKAM) Call Spread; Pete Najarian Owns (BAC) Call Spread; Pete Najarian Owns (DF) Call spread; Pete Najarian Owns (DRYS) Calls; Pete Najarian Owns (F) Calls; Pete Najarian Owns (INTC) Calls; Pete Najarian Owns (ITMN) Call Spread; Pete Najarian Owns (MCD) Call Spread; Pete Najarian Owns (TIVO) Call Spread; Cortes Owns (GS), Is Short S&P 500; Cortes Owns (IAI); Cortes Is Short Treasuries; Finerman's Firm Is Short (IYR), (IJR), (MDY), (SPY), (IWM), (USO); Finerman's Firm Is Long S&P Puts; Finerman Owns (AAPL); Finerman's Firm Owns (BAC), (BAC) Leaps; Finerman Own (BAC) Preferred; Finerman's Firm And Finerman Own (GOOG); Finerman's Firm And Finerman Own (WFC); Fienrman's Firm Owns (YUM); Terranova Owns (GLD) March Puts; Terranova Owns (AAPL), (EMC), (DELL), (GOOG)

GE Is The Parent Company Of CNBC
NBC Universal Is The Parent Company Of CNBC

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 (EXR)
Virtus Investment Partners Owns More Than 1% Of (GOK)
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 (XLP)
Virtus Investment Partners Owns More Than 1% Of (XLB)
Virtus Investment Partners Owns More Than 1% Of (XLV)
Virtus Investment Partners Owns More Than 1% Of (XLI)

For Brian Kelly
Kanundrum Capital Owns (C)
Kanundrum Capital Owns (JPM)
Kanundrum Capital Owns (GE)
Kanundrum Capital Owns (ELX)
Kanundrum Capital Owns (QLGC)
Kanundrum Capital Owns (VMW)
Kanundrum Capital Owns (QCOM)
Kanundrum Capital Owns (BRCM)
Kanundrum Capital Owns (GLD)
Kanundrum Capital Owns (GDXJ)
Kanundrum Capital Is Long U.S. Dollar
Kanundrum Capital Is Short (FCX)
Kanundrum Capital Is Short (SLX)
Kanundrum Capital Is Short Euro
Kanundrum Capital Is Short Pound
Kanundrum Capital Is Short Copper
Kanundrum Capital Owns (SDS)

For Mike Khouw
Cantor Fitzgerald & Co. Is A Market Maker In (F)
Cantor Fitzgerald & Co. Is A Market Maker In (BAC)
Cantor Fitzgerald & Co. Is A Market Maker In (GE)


CNBC.com with wires

Contact Fast Money

  • Showtimes

    Halftime Report - Weekdays 12p ET
    Fast Money - Weekdays 5p ET

Halftime Report