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Halftime Pt.1: Gold On Brink of Parabolic Move?

On Monday investors were chattering about the upside in gold even though the precious metal has already surged 12% over the past 6 months.

The bullish speculation was largely triggered by the outcome of this past weekend’s G20 summit, in which world the leaders fell back on the "Sinatra doctrine" – that is, leaving each nation to do it "my way".

That’s a pithy way of saying each nation plans to adopt different and tailored policies in dealing with the European debt crisis; and not take a unified approach.

How should you be positioned now?

Instant Insights from the Fast Money desk

In the wake of these developments widely followed commodities investor Dennis Gartman tells the Fast Money desk gold could make a sharp move higher - in fact it could be parabolic.

”I hesitate talking about parabolic moves – but when you compare this period to other periods of time in the past (when we’ve had parabolic moves), that’s what well may happen,” he says during a live interview.

Parabolic moves in commodities tend to fall into patterns, Gartman goes on to explain.

“The market starts slowly and takes several years to build.

Then, in the last 10% of the time frame you get 50% of the price movement. I've seen it time after time in 35 years of doing this. And I get the sense that gold is about to do that same thing."

Gartman also feels that gold has room to run because it's something he calls the anti trade. “It’s anti dollar, anti euro and anti the British pound,” he says.

And if you're worried that we're looking at a bubble because retail investors are driving the run in gold, don't be. According to Gartman it's largely institutional money and not money from Main Street.

What’s the bottom line?

"The propensity for people at the margin to move into gold continues," says Gartman. "The trend is up and I continue to be bullish of gold."

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APPLE DRIVES TECH GAINS

The bulls spent Monday fighting early weakness in the market by pushing technology shares higher.

Blockbuster sales of Apple’s latest gadget – the iPhone 4 -- ignited enthusiasm across the sector. 1.7 million units were sold over the first 3 days the device was available to customers. Chip stocks traded higher broadly on the phone’s success.

What must you know to trade tech?

If we were not in this market environment I think Apple shares would already be north of $300, says Jon Najarian. I believe its Apple’s strength that’s driving tech.

But with those kinds of sales and the best product launch in Apple history, the stock should be higher, muses Brian Kelly. I think investors should separate Apple from tech, broadly.

Looking at tech broadly, I think tech should now run because people will still be buying network systems and computers, says Steve Grasso.

In the space I’m watching Intel, says Tim Seymour. I like the chart; the stock held $20. Meanwhile Nokia scares me at current levels. It’s a broken chart right now.

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TAKE YOUR POSITION: MICRON


Ahead of earnings after the bell, chip maker Micron traded sharply higher?

How should you game the stock into earnings?

I’m long Micron as well as SanDisk, reveals Jon Najarian.

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FINREG MOVES TOWARD FINAL STEPS

Financials traded to the downside Monday; all except for the exchanges which experienced nice gains. The moves comes as the House gets closer and closer to voting on the landmark financial reform bill.

How should you be positioned?

I’m short CME, reveals Brian Kelly. We’ve known for quite some time that fin reg will require transparency and benefit the exchanges. When I look at the multiples it seems to me it’s already priced in.

There are about $240 trillion dollars worth of derivatives out there and many could be brought onto the exchanges – there’s no way all of that is priced in – counters Jon Najarian.

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TOPPING THE TAPE: TOBACCO NAMES

Tobacco names topped the tape Monday after the supreme court rejected a tobacco appeals case in which the government requested additional penalties. Altria traded sharply higher on the news.

What’s the trade?

The tobacco makers are typically defensive plays but they haven’t been performing that way because of this potential liability, explains Steve Grasso. If you think the market will continue to drop Altria is now a safer bet as a defensive play.

I agree that now the tobacco makers are a safer place to hide, adds Jon Najarian.




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Trader disclosure: On June 28, 2010, the following stocks and commodities mentioned or intended to be mentioned on CNBC’s Fast Money were owned by the Fast Money traders; Jon Najarian owns (AAPL) call spreads; Jon Najarian owns (MU) call spreads; Jon Najarian owns (SNDK) call spreads; Jon Najarian owns a seat and stock in (CME); Jon Najarian owns a seat and stock in (CBOE)’ Jon Najarian owns a seat and stock in (NYX); Grasso owns (ASTM), (ABK), (BAC), (BGP), (C), (DYN), (JPM), (LPX), (NDAQ), (PRST); Seymour owns (INTC); Kelly owns (BP) puts; Kelly owns (FCX) puts; Kelly owns (GLD); Kelly owns (GDXJ); Kelly is short (GS)

For Steve Grasso:
Stuart Frankel & Co and it’s partners own (BAX)
Stuart Frankel & Co and it’s partners own (COG)
Stuart Frankel & Co and it’s partners own (CUBA)
Stuart Frankel & Co and it’s partners own (DHR)
Stuart Frankel & Co and it’s partners own (DYN)
Stuart Frankel & Co and it’s partners own (GERN)
Stuart Frankel & Co and it’s partners own (HSPO)
Stuart Frankel & Co and it’s partners own (IP)
Stuart Frankel & Co and it’s partners own (MERC)
Stuart Frankel & Co and it’s partners own (NWS.A)
Stuart Frankel & Co and it’s partners own (NYX)
Stuart Frankel & Co and it’s partners own (PDE)
Stuart Frankel & Co and it’s partners own (PFE)
Stuart Frankel & Co and it’s partners own (PRST)
Stuart Frankel & Co and it’s partners own (RDC)
Stuart Frankel & Co and it’s partners own (SYMC)
Stuart Frankel & Co and it’s partners own (TBT)
Stuart Frankel & Co and it’s partners own (TLM)
Stuart Frankel & Co and it’s partners own (TRV)
Stuart Frankel & Co and it’s partners own (XRX)
Stuart Frankel & Co and it’s partners own (SDS)
Stuart Frankel & Co and it’s partners are short (QQQQ)
Stuart Frankel & Co and it’s partners are short (AAPL)

Brian Kelly
Accounts managed by Kanundrum Capital own (AUY)
Accounts managed by Kanundrum Capital own (GFI)
Accounts managed by Kanundrum Capital own (GDX)
Accounts managed by Kanundrum Capital own (GDXJ)
Accounts managed by Kanundrum Capital own Gold
Accounts managed by Kanundrum Capital own Treasuries
Accounts managed by Kanundrum Capital own US Dollars
Accounts managed by Kanundrum Capital is short (AMZN)
Accounts managed by Kanundrum Capital is short (RCL)
Accounts managed by Kanundrum Capital is short (XLY)
Accounts managed by Kanundrum Capital is short (XLE)
Accounts managed by Kanundrum Capital is short (AFL)
Accounts managed by Kanundrum Capital is short (CME)
Accounts managed by Kanundrum Capital is short (EWI)
Accounts managed by Kanundrum Capital is short (EWO)
Accounts managed by Kanundrum Capital is short (GS)
Accounts managed by Kanundrum Capital is short (HIG)
Accounts managed by Kanundrum Capital is short (RKH)
Accounts managed by Kanundrum Capital is short (XLF)
Accounts managed by Kanundrum Capital is short (XLI)
Accounts managed by Kanundrum Capital is short (FCX)
Accounts managed by Kanundrum Capital is short (GFI)
Accounts managed by Kanundrum Capital is short (JOYG)
Accounts managed by Kanundrum Capital is short (XLB)
Accounts managed by Kanundrum Capital is short (XLK)

For Dennis Gartman
Funds managed by Dennis Gartman own Gold


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