Charts Suggest Year-End Rally: Technical Analyst

Monday, 12 Nov 2012 | 5:24 PM ET

Underperforming megacaps could offer opportunity in a year-end rally, Stephen Suttmeier of Bank of America Merrill Lynch Global Research said Monday on CNBC.

"We're looking at the rising 200-day moving average, and the S&P 500 is falling in that area," he said on "Fast Money."

Suttmeier said he was looking at a level of 1,380 for support.

"Normally, when you look at presidential cycles, you're weak from the second half of the first year, which would be 2013 into 2014," he said.

Charts Suggest Year-End Rally: Technical Analyst
Underperforming megacaps could offer opportunity in a year-end rally, says Stephen Suttmeier of Bank of America Merrill Lynch Global Research.

"For now, we think we can get a year-end rally, and there might be a better opportunity to take more profit, more money off the table in the first part of next year," he added.

Suttmeier said that the stock market should be experiencing a two-fold seasonal rally. "Normal seasonality about 2 percent. Election year about 2 percent."

Suttmeier also noted an area that suggests growth, according to his technical analysis.

"Megacaps have underperformed lately, but when you look at what's going on, you're just retesting the breakout points, so this could be an oversold area where you could get back into the megacap stocks," he said.

Trader disclosure: On Nov. 12, 2012, the following stocks and commodities mentioned or intended to be mentioned on CNBC's "Fast Money" were owned by the "Fast Money" traders: Dennis Gartman is long GOLD; Dennis Gartman is short YEN; Dennis Gartman is short Euro; Dennis Gartman is long S&P; Dennis Gartman is long AUD; Tim Seymour is long BAC; Tim Seymour is long SBUX; Karen Finerman is long AAPL; Karen Finerman is long BAC; Karen Finerman is long JPM; Karen Finerman is long WMT; Karen Finerman is long TGT; Karen Finerman is long MSFT; Karen Finerman is long WMT; Karen Finerman is long M; Karen Finerman is long JCP; Karen Finerman is short SPY; Karen Finerman is short IWM; Karen Finerman is short MDY; Steve Grasso is long ACI; Steve Grasso is long AET; Steve Grasso is long ASTM; Steve Grasso is long AUO; Steve Grasso is long BA; Steve Grasso is long BTU; Steve Grasso is long CLF; Steve Grasso is long F; Steve Grasso is long LF; Steve Grasso is long LNG; Steve Grasso is long MHY; Steve Grasso is long P; Steve Grasso is long NVIV; Steve Grasso is long PFE; Steve Grasso is long S; Steve Grasso is long WYNN.

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