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Sell-Off Intensifies As Euro Plunges

The Dow ended the week with a triple-digit slide on concerns the euro may collapse.

However, investors may not be quite as fearful as that sounds.

For the week, the Dow was up 2.3 percent, the S&P 500 was up 2.2 percent and the Nasdaq was up 3.6 percent.

Does weakness in Europe signal the beginning of a global bear market or is it a fear-driven buying opportunity?

Strategy Session with the Fast Money traders

I think we’re seeing a dramatic shift in sentiment on Wall Street, says Gary Kaminsky. Until this week the fear among portfolio managers was to not own stocks and be under-invested. Now there’s a fear to be fully invested and not have cash. That’s a vastly different world in a very short time.

I’m also afraid right now, admits Karen Finerman. I can’t help but wonder if we’re picking up steam to the downside.

I’d rotate away from small caps and into large caps, which should be better able to weather a storm, says Joe Terranova. I’m talking names like Pfizer, Costco and Kohl’s. They’re slow movers but they move slowly in both directions.

I agree with Joe that blue caps such as IBM and Johnson & Johnson are the way to go in this environment, adds Finerman.

If you’re looking for a trade I’d stay long the Vix , says Gary Kaminksy. The only thing I feel certain about is that fear and volatility will get worse before it gets better.

It's astounding to me that the market is now talking about if the EU breaks up, says Tim Seymour. That’s a giant shift in thinking. As an investors I’m small and short.

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CONTRARIAN CALL: EUROPE'S BAILOUT WILL WORK

While much of Wall Street quickly became skeptical of EU’s bailout plan announced Monday Deutsche economist Joe LaVorgna went against popular opinion and insisted it would work.

Earlier in the week he told the desk “it will provide both liquidity and solvency and help restore order to markets."

Considering so many firms are now revising their long-term forecast for the euro, we wondered if LaVorgna wanted to rethink his position.

What does he have to say now? Watch the video and find out!










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WHAT A WEEK FOR GOLD

Gold closed out a wild week on a down note. Despite the modest profit taking the precious metal still rallied over $17 over the last 5 days and up for the 4th consecutive week.

What’s the trade?

If you look at the action during the day, it seems to me that weak hands got out of their positions early and then gold returned to it’s bullish trend, says Joe Terranova.


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CAN THE U.S. CONSUMER SAVE US?

Investors are turning attention to retail next week with earnings due from a slew of giants including Walmart, TJMaxx and Home Depot .

Will the US consumer prevail and save this market?

Out of all of the companies reporting I'm most hopeful about results from Home Depot and Lowes, says Patty Edwards of Storehouse. But that's because it typically takes about $5000 of improvements to take a foreclosure back to market.



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Trader disclosure: On May 14, 2010, the following stocks and commodities mentioned or intended to be mentioned on CNBC’s Fast Money were owned by the Fast Money traders; Terranova Owns Gold; Terranova Owns (GLD), (PFE), (YHOO), (KSS), (COST), (TER), (SWN); Karabell Owns (GOOG), (GS), (C); Grasso Owns (BP), (NDAQ), (DYN), (LPX), (ASTM), (ABK), (BAC), (BGP), (C), (CVGI), (JPM), (PRST), (PFE), (BA), (T), (CSCO), (X); Finerman's Firm Is Short (IYR), (MDY), (SPY), (IWM), (RTH), (US0); Finerman's Firm Is Long S&P Puts; Finerman Owns (AAPL); Finerman's Firm Owns (BAC), (BAC) Call; Finerman Owns (BAC), (BAC) Preferred; Finerman Owns (GOOG); Finerman Owns (GS); Finerman's Firm And Finerman Own (IBM); Finerman's Firm Own (KFT); Finerman's Firm And Finerman Own (JPM); Finerman's Firm Owns (WMT); Seymour Owns (AAPL), (BAC), (GOOG), (MSFT), (UNG); Gordon Is Short Australian Dollar, Canadian Dollar vs. Yen

For Tim Seymour:
Seygem Asset Management Is Short (X)

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 (AMKR)
Virtus Investment Partners Owns More Than 1% Of (IGE)
Virtus Investment Partners Owns More Than 1% Of (DBV)
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 (XLP)
Virtus Investment Partners Owns More Than 1% Of (XLY)
Virtus Investment Partners Owns More Than 1% Of (XLI)
Virtus Investment Partners Owns More Than 1% Of (XLU)
Virtus Investment Partners Owns More Than 1% Of (DRYS)

For Steve Grasso
Stuart Frankel And Its Partners Own (AMR)
Stuart Frankel And Its Partners Own (BAX)
Stuart Frankel And Its Partners Own (DYN)
Stuart Frankel And Its Partners Own (CUBA)
Stuart Frankel And Its Partners Own (DYN)
Stuart Frankel And Its Partners Own (GERN)
Stuart Frankel And Its Partners Own (HSPO)
Stuart Frankel And Its Partners Own (MERC)
Stuart Frankel And Its Partners Own (NWS.A)
Stuart Frankel And Its Partners Own (NYX)
Stuart Frankel And Its Partners Own (PALM)
Stuart Frankel And Its Partners Own (PDE)
Stuart Frankel And Its Partners Own (PFE)
Stuart Frankel And Its Partners Own (PRST)
Stuart Frankel And Its Partners Own (RDC)
Stuart Frankel And Its Partners Own (TLM)
Stuart Frankel And Its Partners Own (XRX)
Stuart Frankel And Its Partners Own (SDS)
Stuart Frankel And Its Partners Are Short (QQQQ)
Stuart Frankel And Its Partners Are Short (CL)
Stuart Frankel And Its Partners Are Short (AAPL)

For Patty Edwards
Edwards Owns (VXX)
Edwards Owns (VXX) For Clients
Edwards Owns (SPY) For Clients
Edwards Owns (GLD) For Clients
Edwards Owns (QQQQ) For Clients
Edwards Owns (BAC) For Clients
Edwards Owns (AAPL) For Clients
Edwards Owns (GOOG) For Clients
Edwards Owns (C) For Clients
Edwards Owns (COST) For Clients
Edwards Owns (CSCO) For Clients
Edwards Owns (JPM) For Clients
Edwards Owns (JNJ) For Clients
Edwards Owns (KFT) For Clients
Edwards Owns (MS) For Clients
Edwards Owns (MSFT) For Clients
Edwards Owns (V) For Clients
Edwards Owns (WMT) For Clients
Edwards Owns (WFC) For Clients
Edwards Owns (YHOO) For Clients

For Simon Leopold
(DY) Is A Client Of Regions Bank, Which, Like Morgan Keegan, Is A Subsidiary Of Regions Financial




CNBC.com with wires

Symbol
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DJIA
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COST
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HD
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IBM
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JNJ
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KSS
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LOW
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PFE
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TJX
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VIX
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WMT
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