GO
Loading...

Near Resistance, Will S&P Break Out or Swipe Lower?

Wednesday, 12 Oct 2011 | 5:56 PM ET

With the Dow at break even for the year and the S&P trading near the upper end of a range should you bet on strong resistance or a break higher?

According to Abigail Doolittle of Peak Theories Research the former is more likely than the latter.

In a live interview on CNBC’s Fast Money, she tells us that chart patterns suggest to her the market is about to consolidate back into the range for another swipe down.

But that doesn’t mean the bears are back in business, entirely.

Doolittle believes that the S&P remains range bound with 1120 looking like a floor and 1220 the ceiling. "I think October is going to be very much about this trading range."

But that's for short term traders.

If you’ve got a longer time horizon, Doolittle is optimistic the market can rally into year's end and into 2012, due to something called an inverse head and shoulders chart pattern. Sounds painful but it’s actually a bull sign – and Doolittle thinks its forming now.

”The break down to 1075 could be considered a spike bottom – it could form the head of an inverse head and shoulders that takes the S&P wildly higher but not until much later.”

Google Earnings & Trading the S&P
Discussing the Akamai takeover rumor by Google and a preview of its earnings, with Mark Mahaney, Citigroup. Also a technical look at trading the top of the S&P 500, with Abigail Doolittle, Peak Theories Research.

* You can find our conversation with Abigail Doolittle about 3 minutes into this video clip.

______________________________________________________
Got something to to say? Send us an e-mail at fastmoney-web@cnbc.com and your comment might be posted on the Rapid Recap. If you'd prefer to make a comment but not have it published on our website send those e-mails to fastmoney@cnbc.com.


Trader disclosure: On Oct 12, 2011, the following stocks and commodities mentioned or intended to be mentioned on CNBC’s "Fast Money" were owned by the "Fast Money" traders; Najarian is long AAPL; Najarian is long C; Najarian is long MSFT; Najarian is long MS; Najarian is long YHOO bonds; Najarian is long WFC calls; Najarian is long ETFC; Najarian is long PEP; Najarian is long A; Najarian is long AKAM; Terranova is long VRTS; Terranova is long LQD; Terranova is long MUB; Terranova is long FCX; Terranova is long TBT; Terranova is long OXY; Terranova is long HOS; Terranova is long F; Terranova is long LULU; Terranova is long OIH; Terranova is long CAT; Terranova is long AXP; Terranova is long EMC; Terranova is long WFC; Terranova is long AAPL; Terranova is long IBM; Terranova is long Silver December $40 puts; Finerman owns AAPL; Finerman owns GOOG; Finerman owns JPM; Finerman owns MSFT; Kelly is long cooper; Kelly is short treasury bonds; Kelly is long IBM; Kelly is long KRE; Doolittle is long FAZ; Doolittle is long GLL; Doolittle is long SDS; Doolittle is long SSO; Doolittle is long TYP; Doolittle is long TZA; Doolittle is long ZSL; Gartman is short S&P 500 futures; Gartman is short euro; Gartman is long corn; Gartman is long wheat; Gartman is long British Pound

For Karen Finerman
Finerman’s firm owns short calls AAPL
Finerman’s firm owns JPM stock leaps & short calls
Finerman’s firm owns MSFT
Finerman’s firm owns YHOO

For Mark Mahaney
Citigroup Global Markets Inc. or its affiliates beneficially owns 1% or more of any class of common equity securities of eBay Inc, Netflix Inc, Yahoo! Inc. This position reflects information available as of the prior business day.
Within the past 12 months, Citigroup Global Markets Inc. or its affiliates has acted as manager or co-manager of an offering of securities of eBay Inc, Google Inc.
Citigroup Global Markets Inc. or its affiliates has received compensation for investment banking services provided within the past 12 months from eBay Inc, Google Inc.
Citigroup Global Markets Inc. or its affiliates expects to receive or intends to seek, within the next three months, compensation for investment banking services from Yahoo! Inc.
Citigroup Global Markets Inc. or an affiliate received compensation for products and services other than investment banking services from Amazon.com Inc, eBay Inc, Google Inc, Priceline.Com Inc, Yahoo! Inc in the past 12 months.
Citigroup Global Markets Inc. currently has, or had within the past 12 months, the following as investment banking client(s): eBay Inc, Google Inc, Yahoo! Inc.
Citigroup Global Markets Inc. currently has, or had within the past 12 months, the following as clients, and the services provided were non-investment-banking, securities-related: Amazon.com Inc, eBay Inc, Google Inc, Priceline.Com Inc, Yahoo! Inc.
Citigroup Global Markets Inc. currently has, or had within the past 12 months, the following as clients, and the services provided were non-investment-banking, non-securities-related: Amazon.com Inc, eBay Inc, Google Inc, Priceline.Com Inc, Yahoo! Inc.

For Gerard Cassidy
A member company of RBC Capital Markets or one of its affiliates managed or co-managed a public offering of securities for JPMorgan Chase & Co. in the past 12 months.
A member company of RBC Capital Markets or one of its affiliates managed or co-managed a public offering of securities for Goldman Sachs Group, Inc. in the past 12 months.
A member company of RBC Capital Markets or one of its affiliates received compensation for investment banking services from Citigroup Inc. in the past 12 months.
A member company of RBC Capital Markets or one of its affiliates received compensation for investment banking services from Morgan Stanley in the past 12 months.

For Alexandra Lebenthal
No disclosures



CNBC.com with wires

  Price   Change %Change
DJIA
---
S&P 500
---

Featured

Contact Fast Money

  • Showtimes

    Halftime Report - Weekdays 12p ET
    Fast Money - Weekdays 5p ET
  • Melissa Lee is the host of CNBC's “Fast Money” and “Options Action.”

  • Scott Wapner is host of the "Fast Money Halftime Report," which airs weekdays from 12 p.m. to 1 p.m. ET.

  • Guy Adami is a contributor on CNBC's "Fast Money." He also is managing director of stockMONSTER.com.

  • Najarian, the "Pit Boss," is cofounder of optionMONSTER.com, a news site for options traders.

  • Finerman is president of Metropolitan Capital Advisors, Inc., a company she co-founded.

  • Founder of EmergingMoney.com

  • Chief Market Strategist for Virtus Investment Partners & CNBC Contributor

Halftime Report