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Watch Stock Market’s ‘Whipsaw Swings’: Brown

Thursday, 29 Nov 2012 | 12:52 PM ET

In a stock market that can pop or drop 200 points on "fiscal cliff" comments from Washington lawmakers, investors can take one of two approaches, Josh Brown of Fusion Analytics said Thursday on CNBC.

"If you're an investor here and you're looking to capture some of these whipsaw moves, you really have to know what you're doing," he said on "Fast Money." "If not, stick with what you like and stay liquid, which has been the approach that we've taken."

The S&P 500 on Wednesday saw a 200-point swing after President Barack Obama and House Speaker John Boehner spoke about budget negotiations ahead of the Dec. 31 deadline by which taxes would rise and spending would be slashed if a deal isn't reached.

Watch Stock 'Whipsaw Swings': Josh Brown
In a stock market that saw a 200-point swing, investors can take one of two approaches, Josh Brown of Fusion Analytics says.

The market saw an 80-point swing Thursday morning following comments from Senate Majority Leader Harry Reid, D-Nev., and Boehner, R-Ohio.

"The more they zip it, the more we go up," said OptionMonster.com's Jon Najarian. "When Boehner came out and said it's not balanced, we don't have cuts on the table, the White House is not trying, that this increases the gamma.

(Read More: 'This Is Now a Trader's Market': Pete Najarian)

"The rate of change of delta — that's what gamma is — it goes up. We're seeing larger and larger risk built into this, based on how long these negotiations take."

Joe Terranova of Virtus Investment Partners cited historical precedent for a sign that a last-minute deal would be reached.

Terranova noted that the Bush-era tax cuts were extended on Dec. 17, 2010, and last year the payroll tax cut was extended on Dec. 23.

This year will be no different, he added.

"This is going to go right down to Dec. 21 in avoiding the 'fiscal cliff.' Don't think anything differently."

Written by Bruno J. Navarro, CNBC.com Producer.

Trader disclosure: On Nov. 29, 2012, the following stocks and commodities mentioned or intended to be mentioned on CNBC's "Fast Money" were owned by the "Fast Money" traders: Jon Najarian is long AAPL; Jon Najarian is long JPM; Jon Najarian is long FB; Jon Najarian is long GOOG; Jon Najarian is long TJX; Jon Najarian is long JCP; Jon Najarian is long EXPE; Jon Najarian is long MA; Jon Najarian is long YUM; Jon Najarian is long RGR; Jon Najarian is long GT; Jon Najarian is long STSI; Jon Najarian is long GLUU; Jon Najarian is long CME; Jon Najarian is long CBOE; Mike Murphy is long AAPL; Mike Murphy is long BAC; Mike Murphy is long TGT; Josh Brown is long AAPL; Josh Brown is long WFC; Josh Brown is long GDX; Josh Brown is long GLD; Josh Brown is long XLU; Josh Brown is long WMT; Josh Brown is long TGT; Josh Brown is long V; Josh Brown is long MA; Joe Terranova is long VRTS; Joe Terranova is long TJX; Joe Terranova is long AAPL; Joe Terranova is long SWN; Joe Terranova is long GLW; Joe Terranova is long DELL; Joe Terranova is long VZ; Joe Terranova is long XOM; Dennis Gartman is long Gold in Yen Terms.

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