Is the market full of bullish signals that everyone’s ignoring? John Bollinger thinks so.
“I am pretty constructive on stocks here. Part of the reason is that few other people are,” the founder of Bollinger Capital Management said on “Fast Money” Wednesday. “The background is pretty bullish. We have good seasonals for us. We have good market internals.”
Bollinger, known for his technical analysis, said at least two positive seasonal forces were coming into play.
“We’re just coming into the best part of the year to own stocks, December through May,” he said. “In addition, from the four-year perspective, this is the best part of the presidential cycle to own stocks.”
Bollinger invoked the Dow theory buy signal, saying that stocks have “turned up and cleared resistance.”
The time to buy in this “net positive environment” would be on any pull-backs.
“I don’t think you have to worry about stops so much here. You may have to be doing a little bit of hedging if we get some untoward news events here,” Bollinger said.
Institutional investors are largely underinvested, playing low-beta, defensive positions.
“There’s going to be a lot of catch-up to play here,” he said. “We could see some pretty big upside in the market.”
Bollinger added a caveat.
“Seasonality never works perfectly,” he said. “It’s background information. It gives you a direction you can follow if nothing else intervenes.”
There are no sure plays in the current environment, said trader Joe Terranova.
“The financial world that we transact in has completely changed,” he said.
Trader Tim Seymour said the S&P 500 tipping point was 1,280.
From there, “I think you get a waterfall effect up to the 1,330 level,” he said. “That’s what I would be playing for.”
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Trader disclosure: On Dec. 7, 2011, the following stocks and commodities mentioned or intended to be mentioned on CNBC’s "Fast Money" were owned by the "Fast Money" traders: Seymour is long AAPL; Seymour is long BAC; Seymour is long INTC; Seymour is long CSCO; Gartman is long Gold; Terranova is long EMC; Terranova is long SU; Terranova is long NCR; Terranova is long UPC; Terranova is long TRLG; Terranova is long VRTS; Terranova is long LQD; Terranova is long MUB; Terranova is long AXP; Terranova is long IBM; Terranova is long HES; Terranova is long CAT; Terranova is long SWN; Terranova is long CNI; Terranova is long DECK; Terranova is long SBUX; Murphy is long AKS; Murphy is long BAC; Murphy is long BTU; Murphy is long PCX; Stutland is long INTC; Stutland is long IBM ; Stutland is long CSCO and short calls; Stutland is long WMT and short calls; Stutland is long FXE put spread ; Stutland is long EWZ and short call; Stutland has GOOG short put spread; Stutland is long LQD; Stutland has TLT short puts; Stutland is long TIPS; Stutland is long DBA and short calls; Stutland is long AAPL and short calls; Stutland is long MSFT and short calls;
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