Bulls had every reason to run on Monday and they embraced the opportunity with gusto driving the S&P above 1250, a former level of strong resistance.
A flurry of mergers boosted optimism and Caterpillar results restored hope that the economy was not heading into a double dip.
The world's largest heavy equipment maker reported a 44 percent jump in quarterly profit on record revenues.
Also hopes that Europe was close to resolving its financial crisis buoyed sentiment.
Fast trader Joe Terranova sees no reason for the momentum in the market to end. ”I think portfolio managers are way behind the benchmark and now they’re chasing and scrambling."
"The other thing is, this week is a big, big week in terms of mining names, energy names, industrial names . We've gotten some good forecasts going forward, so as long as all that holds, that will (also) fuel this fire," says Ken Polcari, managing director at ICAP Equities in a Reuters interview.
Considering all the bullish catalysts, Terranova thinks the risk is to the downside. That path of least resistance, he says, appears to be higher.
What do you think? We want to know!
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Trader disclosure: On Oct 24, 2011, the following stocks and commodities mentioned or intended to be mentioned on CNBC’s "Fast Money" were owned by the "Fast Money" traders; Nathan has long Jan. puts BAC; Nathan has long Oct. puts GS; Nathan has long Jan. puts MS; Nathan has long Oct. put butterfly NFLX; Terranova owns IBM; Terranova owns AAPL; Terranova owns AXP; Terranova owns CAT; Terranova owns F; Terranova owns GS; Terranova owns OXY; Terranova owns FCX; Terranova owns LQD; Terranova owns MUB; Seymour is long BAC; Seymour is long INTC; Seymour is long FCX; Brown is long RAX; Nations is long SPY
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I, Michael Pachter, certify that the views expressed in this report accurately reflect my personal opinion and that I have not and will not, directly or indirectly, receive compensation or other payments in connection with my specific recommendations or views contained in this report.
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