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Chartology: Resist The Rallies?

Short-term rallies may lull you into false sense of security. Find out why consumer staples might not be as safe as you think.

Qunit Tatro, Founder And President of Tatro Capital joins the panel for this conversation. Following is a synopsis of his main points.

The Market

Chart: S&P 500
Analysis: We could be seeing a double bottom forming in the short term – but I recommend selling any rally, counsels Tatro. The trend lines suggest to me the S&P is ultimately going lower.

The Sells:

Chart: P&G
Analysis: This isn’t your father’s recession, says Tatro. The chart suggests this may not be a safe place to hide, and I think it’s because commodity prices are climbing.

Chart:Campbell Soup
Analysis: This stock broke down and may be working on another leg lower, Tatro says.

The Buys:

Chart:Chesapeake Energy
Analysis: Recently broke out of a 3-year base, says Tatro and could be a buy on any pull back.

Chart: Joy Global
Analysis: JOYG could be coming close to mulit-year break. It’s a buy if it breaks higher, he says.

Trading a Recession

To see the charts used in this analysis please watch the video.

Read More:

Check out what Tatro told the panel on Monday Feb. 11th the last time he was on Fast Money in Technicals & Turbulence

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Trader disclosure: On Mar. 7, 2008, 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 (BIIB), (BKC), (C), (CSCO), (MS), (MSFT), (XLF), (YHOO), (AAPL); Najarian Owns (COP) Calls, (BHI) Calls, (AMAT) Calls; Seymour Owns (BX), (CFC), (F), (HAL), (MER),  (MSFT),  (SBUX),  (TSO), (AAPL), (INTC); Seygem Asset Management Owns (EEM); Seygem Asset Management Is Short (FXI); Finerman Owns (GS); Finerman's Firm Owns (MSFT),  (TSO), (WMT), (YHOO), (FNM), (AAPL), (MO), (AEO); Finerman's Firm Is Short (IYR), (IJR),  (MDY), (SPY), (IWM); Finerman's Firm Is Short (LEH) And Owns (LEH) Puts

Tatro Owns (ADM), (UNG); Clients Of Tatro Own (SPY)