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Stock Market Setting Up for a Bounce?

With so many pundits and prognosticators talking gloom and doom, could the market surprise the Street and bounce?

Trader Guy Adami thinks it's entirely possible.

Adami is hardly a bull but he always says price is truth and the price action on Thursday suggests to him that the bulls may be about to run.

“In the long-term I think the market is going lower,” Adami says, “but if the bears can’t break 1300, I think the market sets up for a huge snap back rally on Friday.”

Largely Adami thinks that if declining oil prices, a stronger dollar, 10-year yields at 60 year lows, and other catalysts can’t drive the S&P below 1300 – then it’s not going to happen immediately.

“The economic data was not great on Thursday, but it wasn’t catastrophic either. I think the shorts could be getting ahead of themselves.”

In other words, if buyers prevail on any positive news – the market could get caught in the throes of a short covering rally and move sharply higher.

What do you think? We want to know!

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Posted by CNBC's Lee Brodie

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Trader disclosure: On May 31, 2012, the following stocks and commodities mentioned or intended to be mentioned on CNBC’s "Fast Money" were owned by the "Fast Money" traders; Guy Adami is long C; Guy Adami is long GS; Guy Adami is long INTC; Guy Adami is long AGU; Guy Adami is long MSFT; Guy Adami is long NUE; Guy Adami is long BTU; Pete Najarian is long AAPL; Pete Najarian is long AAPL CALLS; Pete Najarian is long C; Pete Najarian is long GDX CALLS; Pete Najarian is long INTC; Pete Najarian is long SBUX; Pete Najarian is long PEP; Pete Najarian is long FB; Jon Najarian is long FB CALL SPREADS; Jon Najarian is long DAL CALL SPREADS; Jon Najarian is long JPM CALL SPREADS; Jon Najarian is long GS CALL SPREADS; Jon Najarian is long VIX CALL SPREADS; Jon Najarian is long CIGX; Jon Najarian is long DDMG; Jon Najarian is long CME; Jon Najarian is long CBOE

For Charles Grom
Deutsche Bank (and/or affiliates) own 1% or more of any class of common equity securities of this company: JCP
Company an Investment Banking client of DBS: JCP
Deutsche Bank (and/or affiliates) own 1% or more of any class of common equity securities of this company: SKS
Company an Investment Banking client of DBSI: TGT
Deutsche Bank and/or its affiliate(s) has received non-investment banking related compensation from this Company within the past year: TGT
Company has been a client of Deutsche Bank Securities Inc. within the past year, during which time it received non-investment banking securities-related services: TGT
Company an Investment Banking client of DBSI: WMT
Deutsche Bank and/or its affiliate(s) has received non-investment banking related compensation from this company within the past year: WM
This company has been a client of Deutsche Bank Securities Inc. within the past year, during which time it received non-investment banking securities-related services: WMT


CNBC.com with wires.

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