With the S&P closing in the green on Monday, investors were searching high and low for signs to determine whether gains were a sign that the selling was almost over -- or if gains were nothing more than a knee-jerk bounce.

Bulls were cautiously optimistic with overseas developments appearing relatively positive:  G8 leaders gave verbal backing for Greece to stay in the euro and China's premier called for additional efforts to drive growth on Sunday.

However, that's not to say the market isn't without headwinds. Lowe's cut its fiscal-year earnings outlook and said demand slowed toward the end of the traditionally strong first quarter.

Should you position for a turn higher, or should you prepare for the next leg down?

Strategy Session with the Fast Money traders

“I think Monday’s gains were nothing more than a relief rally,” says trader Steve Grasso. The market did not have to grapple with a negative headline out of Europe and Grasso thinks that was enough to trigger buying.

“We bounced off 1292, a key technical level,” says Grasso, “but I want to see a sustained rally above 1340 before I could feel good about the market.”

Grasso thinks the advance is nothing more than a pause during a larger slide lower.

“I think the downside is flat on year which is 1257 – and I think it happens sooner rather than later,” says Grasso.

Trader Guy Adami agrees. Although he concedes the market could continue to bounce in the short-term, “rallies are meant to be sold,” he says.

Trader Karen Finerman shares the skepticism. “I was surprised the rally held – I thought it would fade – we’re only back to where we were Thursday afternoon.”

Trader Brian Kelly is more bullish; he thinks a rally could find a foothold. “I think into the Greek elections the market could rally but up around 1380 I’d grow cautious.”

Posted by CNBC's Lee Brodie

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Trader disclosure: On May 21, 2012, the following stocks and commodities mentioned or intended to be mentioned on CNBC’s "Fast Money" were owned by the "Fast Money" traders; 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 RIMM; Karen Finerman is long HPQ; Karen Finerman is short SPY; Karen Finerman is short IWM; Karen Finerman is short MDY; 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; Brian Kelly is long WFC; Brian Kelly is long GLD; Brian Kelly is long INTC; Brian Kelly is long T; Brian Kelly is long VZ; Brian Kelly is long LO; Brian Kelly is short EUROSTOX 50; Brian Kelly is short CAE 40; Stephen Grasso is long ASTM; Stephen Grasso is long BA; Stephen Grasso is long D; Stephen Grasso is long FRO; Stephen Grasso is long LNG; Stephen Grasso is long MHY; Stephen Grasso is long MO; Stephen Grasso is long PFE; Stephen Grasso is long S; Stephen Grasso is long XLU; Stephen Grasso is long ZAZA

For Steve Grasso
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For Scott Nations
Scott Nations is long SPY
Scott Nations is long BAC
Scott Nations is long C
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For Herman Leung
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For Toni Sacconghi
Bernstein currently makes a market in the following companies DELL

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