I agree that the market can and probably will bounce and if you're looking for a trade FedEx should get the job done, muses Guy Adami.
As far as I’m concerned 1050 is a key level on the S&P, says Steve Grasso. I’ll be watching that closely. Also, I can't help but wonder if we've already had our September in August.
AUGUST BEST: GOLD
If there was a trade that worked in August it was long gold . The precious metal ended the month near its August highs after a raft of soft economic data lifted its appeal as a haven.
"People are fearful enough of what else is going on in the economy and that is sufficient to justify what is going on in gold," explains Peter Hillyard of ANZ in a Reuters interview.
"It's a bit of a continuation of what is going on in other markets with month-end and I think $1,300 is on the cards... as soon as September," he adds.
What’s the trade?
I’m seeing call buying in December at the 1500 strike, says Joe Terranova. That suggests market participants expect gold to make a sharp move higher. They seem to want to own gold. Personally, I think gold is going to $1300 in the near-term.
I’m watching the Gold Miners ETF , counsels Pete Najarian on the Halftime Report. They've had a big run. Recent options action suggested big investors expected this ETF to go to $55 and that's about where we are now.
AUGUST WORST: FINANCIAL SECTOR
And if there was a trade to avoid in August it was long banks . Concerns about the economy, employment and the ability of consumers to pay back loans sent these stocks tumbling.
Looking at the Bank ETF, 15 proved to be a point of strong resistance with bears pressuring the sector from that point forward. It’s largely believed that the market can’t rally sustainably without the banks.
What the trade?
I don’t see vanilla institutions buying financials, reveals Steve Grasso. In fact my clients seem to be letting them go further and further down.
The one trade I’d look at in the space is long Citi, says Joe Terranova. Around $3.70 I like it.
AUGUST WORST: TECH SECTOR
Tech was another underperformer this month. Investors struggled with the sudden departure of HP's Mark Hurd, a disastrous forecast from Cisco , and downgrade after downgrade for BlackBerry maker RIM .
What’s the trade?
In this space I like Intel, says Tim Seymour. I think the stock is badly oversold.
Around $123 IBM looks attractive to me, says Guy Adami, but it’s a long-term investment.
STOCK MARKET IS SIGNALING RECESSION COMING BACK
Will the remainder of this week's economic data disappoint? David Levy of The Jerome Levy Forecasting Center sits squarely in the bearish camp.
Find out why he thinks all coming signs point to another recession!
Watch the video now!