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Halftime Report: Pullback Or Profit Taking?

Tuesday, 30 Mar 2010 | 1:18 PM ET

A new all time high for a number of stocks couldn’t keep the S&P in the green on Tuesday.

Is the action just end of quarter profit taking or are we heading for a pullback?

Strategy Session with the Fast Money traders

I think we’re seeing profit taking with investors perhaps looking for a bit of a pullback, says Pete Najarian. There’s no denying that volume is absolutely awful. As far as I can tell, investors are ready to close up the quarter right here.

Moves lower in Citi and BofA look like profit taking, counsels Todd Gordon of Forex.com. But there is another stock that’s making me worry about a pullback. Goldman failed around 178 – that’s the 2010 high. I think that’s a cause for concern. And it's gone under the radar.

I’m a little concerned about financials too, says Patty Edwards of Storehouse. However, I’m long Goldman but it’s for the long term. And broadly I’m neutral on the market.

Fast Money Halftime Report
How to invest now, with the Fast Money crew.


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OIL CONTINUES HIGHER

Crude oil prices paused on Tuesday, as traders digested bumper gains made the previous day.

Oil had spiked higher on Monday on the back of a weak US dollar, rising stock markets and hopes of economic recovery, as well as concerns after deadly suicide attacks on the Moscow metro.

What must you know?

Volume in the oil market is very light, says Addison Armstrong of Tradition Energy. I expect the oil market to be sleepy into the holiday. I think we see crude bounce around and test below $82.

And despite a bullish outlook from Goldman about nat gas, I just see no reason for nat gas to rally, Armstrong adds.

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APPLE HITS NEW ALL TIME HIGHS ON VERIZON PHONE

Shares of Apple popped on Monday after reports suggested that a deal for Verizon to carry Apple’s iPhone was in the works.

Fast Money was among the first to bring you the news – in an exclusive interview with Canaccord Adams analyst Peter Misek. (Click herefor all the details.)

What’s the trade?

It wouldn’t surprise me to see Verizon to get a big bump, says Patty Edwards. As for Apple -- color me cynical but typically Apple shares sell off right after the launch of a new product.

I think Apple is a dangerous game, says Pete Najarian, however there’s no doubt that people are excited about the new iPad. But I prefer Nokia as a play on their new smartphone or RIM. Or consider a second derivative trade. over the next few quarters I expect to see upside in chip makers such as Qualcomm and Marvel .

The iPhone developments are something of a headwind for AT&T, says Todd Gordon. I’m seeing a key sell signal in this stock. I think AT&T moves to the downside.

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NETFLIX HITS NEW HIGHS

Netflix made new highs on Tuesday after FBR Capital analyst Heath Terry lifted his price target to $85, from $71 citing new opportunity from the Nintendo Wii.

Last week Netflix shipped discs to select customers which allow them to watch Netflix moves over the Wii console.

*For more from FBR Capital analyst Heath Terry check out the video

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FAST FOOD TRADE: MCD

The fast food trade continued to work Tuesday with McDonald’s hitting a new all time high on news that the hamburger giant plans to nearly double the number of its eateries in China by the end of 2013.

What’s the trade?

In the space I like Yum! for its presence in China as well as its growth plan in India, says Pete Najarian. Options action tells me that by June investors expect Yum shares to trade sharply higher.

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CALL THE CLOSE

Pete Najarian: I think people are ready to close up the quarter and finish it right here.

Patty Edwards: I’m neutral on the market.

Todd Gordon: I think we’re heading lower in the euro.

Addison Armstrong: I think we see crude bounce around and test below $82.


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Trader disclosure: On March 30th, 2010, the following stocks and commodities mentioned or intended to be mentioned on CNBC’s Fast Money were owned by the Fast Money traders; Najarian Owns (IPI) Call Spread; Najarian Owns (MRVL); Najarian Owns (CLF) Call Spread; Najarian Owns (YUM) Call Spread; Najarian Owns (DOW) Call Spread; Finerman's Firm Is Short (IYR), (IWM), (SPY), (MDY); Finerman's Firm Is Long S&P Puts; Finerman Owns (AAPL); Finerman's Firm Owns (BAC), (BAC) Preferred; Finerman Owns (BAC), (BAC) Leaps; Finerman's Firm Owns (FLIR); Finerman Owns (GOOG); Finerman's Firm And Finerman Own (GGP); Finerman's Firm Owns (NOK), (OSIP); Finerman's Firm And Finerman Own (WFC); Adami Owns (AGU), (C), (GS), (INTC), (MSFT), (NUE), (BTU); Terranova Is Short (EL); Terranova Is Short (GS); Terranova Is Short (CAL); Terranova Is Short (UAUA); Terranova Is Long May 2010 Crude Oil Futures; Cortes Is Short Euro; Cortes Is Short Treasuries; Cortes Owns (IWM), (IBB) vs. Short S&P; Edwards Owns (TM), (UUP)

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 Patty Edwards
Edwards Owns (AAPL) For Clients
Edwards Owns (BA) For Clients
Edwards Owns (BAC) For Clients
Edwards Owns (C) For Clients
Edwards Owns (F) For Clients
Edwards Owns (GLD) For Clients
Edwards Owns (PGM) For Clients
Edwards Owns (GS) For Clients
Edwards Owns (GOOG) For Clients
Edwards Owns (MMM) For Clients
Edwards Owns (MOT) For Clients
Edwards Owns (MS) For Clients
Edwards Owns (MSFT) For Clients
Edwards Owns (NFLX) For Clients
Edwards Owns (NOK) For Clients
Edwards Owns (QQQQ) For Clients
Edwards Owns (RIMM) For Clients
Edwards Owns (SPY) For Clients
Edwards Owns (T) For Clients
Edwards Owns (TM) For Clients
Edwards Owns (VWSTX) For Clients
Edwards Owns (VWLTX) For Clients
Edwards Owns (VZ) For Clients
Edwards Owns (WFC) For Clients
For Heath Terry
FBR Capital Markets Is a Market Maker Or Liquidity Provider For (NFLX)

For Pip Coburn
Coburn Is A Partner In Buckeye Delta Fund
Buckeye Delta Fund Owns (AAPL)
Buckeye Delta Fund Owns (GOOG)
Buckeye Delta Fund Owns (RIMM)
Buckeye Delta Fund Is Short (MOT)
Buckeye Delta Fund Is Short (YHOO)
Buckeye Delta Fund Is Short (NOK)


CNBC.com with wires

  Price   Change %Change
S&P 500
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BAC
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C
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GS
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MRVL
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NFLX
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NOK
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QCOM
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BB
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T
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VZ
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YUM
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AAPL
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MCD
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