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Halftime: Weak-Dollar Trades Finished?

If one thing can bring the bulls to their knees it’s the dollar . It’s hard to ignore the fact that for the past three months the S&P and the greenback have traded in an almost perfect inverse relationship.

And with a G20 meeting scheduled for this week-end, one of the key issues on the table is expected to be the dollar’s rapid depreciation.

The dollar has dropped sharply since Aug. 27, when Chairman Ben S. Bernanke signaled the Federal Reserve was prepared to ease monetary policy.

Considering the rapid depreciation can the dollar decline much more - at least by the end of the year? And if not, does that spell curtains for the S&P?

Instant Insights with the Fast Money traders

Current dollar strength stems from the significant rhetoric ahead of the week-end G20 meeting, explains Michael Woolfolk of BNY Mellon. After the meeting I expect the focus to shift and return to the next FOMC meeting and QE2. That should trigger more dollar selling. As a result I expect the S&P continues to rally.

I don't see it that way, counters Steve Cortes of Veracruz. Dollar bearishness is far too crowded a trade. It’s a consensus trade that I want to fade. I’m long the dollar. The euro has tested and failed at $1.40 time and again. Unless that relationship between the dollar and the euro changes I'm bullish the greenback.

I’m concerned about the dollar's rapid decline too, adds Steve Grasso. If may be too far too fast. I’d want to see it weaker before I can feel the market will run much higher.

I would not be long the dollar, counters Joe Terranova. I still think the path for the dollar is lower and all we’re seeing right now is a modest bounce.

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CHART OF THE DAY: FREEPORT MCMORAN

Steve Gasso is closely watching the action in Freeport McMoRan which made a sharp turn lower on Friday.

The problem with FCX is technical, he says, and the charts suggest it could come in dramatically. Although I still like the company, I’d wait and buy a pullback.

Don’t forget FCX as well as the spot price of copper have been on a tear, adds Pete Najarian. A pullback wouldn’t surprise me.

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BREAKING NEWS: APOLLO

On Friday Apollo Group confirmed reports out earlier in the week that it is, in fact, under investigation by the state of Florida.

The notice from the Florida attorney general includes a subpoena to produce documents and information about the university's business from Jan. 1, 2006, to the present, Apollo
said in a regulatory filing.

The company is evaluating the notice and subpoena, it said in the filing.

Apollo and peers have come under fire from regulators and the Obama administration for saddling students with big debts and not fully preparing them for jobs.

What’s the trade?

The stock didn’t really move on the news, explains Pete Najarian, perhaps it’s already priced in.

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REVERSAL: AMAZON TURNS AROUND

Amazon continues to amaze with shares hitting a new all time high on Friday after making bullish reversal after last night's after hours sell off.

What should you make of it?

Margins my be coming in but sales were absolutely extraordinary, says Pete Najarian. And they’re building out for growth.

Also Amazon is a Q4 story because of holiday shopping, adds Steve Grasso.



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Trader disclosure: On October 22nd, 2010, the following stocks and commodities mentioned or intended to be mentioned on CNBC’s Fast Money were owned by the Fast Money traders; Pete Najarian owns (BAC); Pete Najarian owns (GDXJ); Pete Najarian owns (YHOO); Pete Najarian owns (DOW); Pete Najarian owns (DD); Pete Najarian owns (AAPL) call spread; Pete Najarian owns (AKAM) call spreads; Pete Najarian owns (NFLX) call spreads; Pete Najarian owns (F) Bonds; Terranova owns (APA), (AAPL), (AXP), (C), (CRM), (GOOG), (GS), (FCX), (ISRG), (MMM), (ORCL), (PCP), (PEP), (PFE), (TBT), (UPL), (VRTS), (XBI); Cortes owns (K); Cortes owns (TSN); Cortes is short crude oil; Cortes is short gold; Cortes is short (RSX); Cortes is short the U.K. Pound; Cortes owns the S&P 500; Grasso owns (ASTM), (BA), (BAC), (C), (CSCO), (JPM), (LPX), (MO), (MOT), (NDAQ), (PFE), (PRST)

For Joe Terranova:
Terranova is chief market strategist of Virtus Investment Partners, LTD.
Virtus Investment Partners own more than 1% of (ABAX)
Virtus Investment Partners own more than 1% of (ALK)
Virtus Investment Partners own more than 1% of (AMKR)
Virtus Investment Partners own more than 1% of (CASS)
Virtus Investment Partners own more than 1% of (CSVI)
Virtus Investment Partners own more than 1% of (IGE)
Virtus Investment Partners own more than 1% of (LDR)
Virtus Investment Partners own more than 1% of (LPHI)
Virtus Investment Partners own more than 1% of (MGRC)
Virtus Investment Partners own more than 1% of (NRCI)
Virtus Investment Partners own more than 1% of (DBV)
Virtus Investment Partners own more than 1% of (XLB)
Virtus Investment Partners own more than 1% of (XLP)
Virtus Investment Partners own more than 1% of (XLY)
Virtus Investment Partners own more than 1% of (XLF)
Virtus Investment Partners own more than 1% of (XLI)
Virtus Investment Partners own more than 1% of (XLU)
Virtus Investment Partners own more than 1% of (SUBK)
Virtus Investment Partners own more than 1% of (WDFC)
Virtus Investment Partners own more than 1% of (YDNT)
Virtus Investment Partners own more than 1% of (DRYS)

For Steve Grasso:
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 (GERN)
Stuart Frankel & Co and it’s partners own (HSPO)
Stuart Frankel & Co and it’s partners own (MCD)
Stuart Frankel & Co and it’s partners own (MERC)
Stuart Frankel & Co and it’s partners own (MGM)
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 (OPEN)
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 (TLM)
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 own (UAL)
Stuart Frankel & Co and it’s partners are short (QQQQ)


For Michael Woolfolk
***No Disclosures***

For David Bank
RBC is currently providing (CSC) with investment banking services
RBC intends to seek compensation for investment banking services from (CSC) in the next 3 months.




CNBC.com with wires.

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