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S&P Range Bound, but Cisco Breaking Out?

On Thursday the Fast Money pros were developing new strategies for trading this market with Guy Adami and Steve Grasso focussed on the S&P , which traded lower after making substantial gains over six of the last seven sessions.

Since only last Tuesday, the S&P has gained over 100 points, climbing more than 11 percent. In fact, the currently rally is the biggest seven-day rally since March 2009.

Can it continue?

”If the S&P can close above 1228, that will change sentiment in the market,” explains trader Steve Grasso. “If that happens it will be huge for the bulls.

However, Grasso is skeptical. “With China being a big wildcard, I’d take profits,” he says.

Trader Guy Adami is also cautious. “It looks like the market remains in a defined range with 1220 the top of the range. I think we’re in the upper end of the range – I think we push lower.”

Abigail Doolittle of Peak Theories Research agrees, adding that although 1220 is the ceiling, 1120 is probably the floor. "I think October is going to be very much about this trading range," she says.

Whenever the market is stuck in a rut, the Fast Money traders always recommend taking a hard look at what’s working – and on Thursday that was tech with chip stocks, Apple and Google all performing impressively well.

Trader Jon Najarian likes the chips a lot and suggests playing the space with Cree and/or Intel.

In this space, Guy Adami suggests long IBM. “Trading at all time highs, it’s been impervious to any tape.”

And Adami also suggests putting Cisco on the radar. It’s getting close to breaking out – if it can get over $17.50 it will reverse a trend that’s been in place for a couple years. Above that level, it may be breaking out.”

Patty Edwards likes playing tech with Qualcomm.

Even the contrarian Steve Cortes says “if you want to be long, be long tech.” Of course Cortes can't shake his contrarian nature all together. With turmoil in Europe and bearish action in copper – Cortes sees no reason to be long.




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Trader disclosure: On Oct 13, 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 owns long call spreads ANF; Najarian owns long call spreads AAPL; Najarian owns long call spreads AKAM; Najarian owns long call spreads WLT; Najarian is long CME; Najarian is long CBOE; Najarian is long CIGX; Adami Owns (AGU); Adami Owns (C);Adami Owns (GS); Adami Owns (INTC); Adami Owns (MSFT); Adami Owns (NUE); Adami Owns (BTU); Cortes is long WMT; Cortes is long SVU; Cortes is long SO; Cortes is long CAG; Cortes is long Treasury bonds; Cortes is short DIS; Cortes is short AAPL; Cortes is short DB; Cortes is short SI; Cortes is short Aussie dollar; Grasso owns AA; Grasso owns AKS; Grasso owns ASTM; Grasso owns BA; Grasso owns BAC; Grasso owns D; Grasso owns LIT; Grasso owns MHY; Grasso owns PFE; Grasso owns PRST; Grasso owns S; Grasso owns XLU; Edwards is long XLK

For Patty Edwards
Trutina Financial is long Apple (AAPL)
Trutina Financial is long Citigroup (C)
Trutina Financial is long Disney (DIS)
Trutina Financial is long Google (GOOG)
Trutina Financial is long Oracle (ORCL)
Trutina Financial is long SPDR Gold Trust (GLD)
Trutina Financial is long Utilities SPDR (XLU)
Trutina Financial is long TARGET (TGT)
Trutina Financial is long QCOM
Trutina Financial is long SAFEWAY (SWY)
Trutina Financial is long WALTER ENERGY WLT

For Steve Grasso
Stuart Frankel & Co and it’s partners own (CSCO)
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 (HPQ)
Stuart Frankel & Co and it’s partners own (HSPO)
Stuart Frankel & Co and it’s partners own JPM
Stuart Frankel & Co and it’s partners own MET
Stuart Frankel & Co and it’s partners own MSFT
Stuart Frankel & Co and it’s partners own MU
Stuart Frankel & Co and it’s partners own (NYX)
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 UAL
Stuart Frankel & Co and it’s partners own XRX

For Brian Kelly
Shelter Harbor Capital is short S&P Futures
Shelter Harbor Capital is long GLD

For David Trone
JMP Securities currently makes a market in this security Goldman Sachs (GS)*
JMP Securities currently makes a market in this security Morgan Stanley (MS)*
JMP Securities currently makes a market in this security Bank of America (BAC)*
JMP Securities currently makes a market in this security JP Morgan (JPM)*
JMP Securities currently makes a market in this security Citigroup (C)*
*(1) JMP Securities currently makes a market in this security. (2) JMP Securities has not received compensation for banking or other services rendered to this company in the past 12 months. (3) JMP Securities has not served as a manager or co-manager of a public offering for this company in the past 12 months. (4) JMP Securities has not participated as an underwriting or selling group member of a public offering by this company in the past 12 months. (5) JMP Securities and its affiliates have not have obtained a position of at least 1% in the equity securities of this company during the ordinary course of its/their business/investments. (6) No officer of JMP Securities is a director or officer of this company. (7) Neither the analyst covering this company (as defined in NASD Rule 2711) nor a member of the analyst's household has a financial interest in this company. (8) Neither the analyst covering this company nor a member of the analyst’s household serves as an officer, director, or advisory board member of this company. (9) The analyst covering this company has not had discussions of employment with the company within the past twelve months.

For Jordan Rohan
Stifel, Nicolaus & Company, Inc. expects to receive or intends to seek compensation for investment banking services from Google Inc. in the next 3 months. Stifel, Nicolaus & Company, Inc. makes a market in the securities of Google Inc.

For Charles Grom
Within the past year, Deutsche Bank and/or its affiliate(s) has managed or co-managed a public or private offering for this company, for which it received fees.

Deutsche Bank and/or its affiliate(s) has received compensation from this company for the provision of investment banking or financial advisory services within the past year.

14. Deutsche Bank and/or its affiliate(s) has received non-investment banking related compensation from this company within the past year.

15. This company has been a client of Deutsche Bank Securities Inc. within the past year, during which time it received noninvestment banking securities-related services.




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