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Traders debate how to play a possible September rate hike

The "Fast Money" traders debated how to position ahead of a possible September rate hike.

At the Federal Reserve's annual Jackson Hole summit, Fed Chair Janet Yellen said "the case for an increase in the federal funds rate has strengthened in recent months."

Trader Guy Adami said that a September rate hike would help the Federal Reserve regain some of its credibility. He said he remains bullish on bonds.

"I still think that the 10-year is going to sort of sit back down to 1.4, 1.5 percent. But on the other side of that, I think you're going to see the front-end of the curve move up," Adami said.

Trader Brian Kelly said he thinks it's a good idea to buy into the bond market and utilities at this point, especially if an investor is looking for yield.


Disclosures:

STEVE GRASSO

Steve Grasso is long BA, CC, EVGN, KBH, MJNA, MU, OLN, PFE, PHM, T, TWTR, GDX, XLF. Grasso's kids Own EFA, EFG, EWJ, IJR, SPY. No shorts. Stuart Frankel & Co Inc. and some of its Partners have a financial interest in LDP, WDR, AVP, CVX, FCX, ICE, KDUS, KO, MAT, MCD, MJNA, NE, NEM, OLN, OXY, RIG, STAG, TAXI, TEX, TITXF, URI, VALE, WDR, WYNN, ZNGA, CUBA, HSPO, ICE, AMZN, MJNA, TITXF, NXTD, SPY, QQQ, DIA, XLI, BGCP, VIRT, JCP, GE, AIR FP.

TIM SEYMOUR

Tim Seymour is long APC, AVP, BAC, BBRY, CLF, DAL, DO, DVYE, EDC, EWZ, F, FB, FCX, FXI, GM, GOOGL, GRMN, GE, INTC, LQD, M, MCD, MPEL, NKE, RACE, RAI, RH, RL, SINA, T, TWTR, UA, VALE, VZ, XOM and short: SPY, XRT. His firm is long ABX, BABA, BIDU, CBD, CLF, EWZ, F, HD, KO, MCD, MPEL, NKE, PEP, PF, SAVE, SBUX, SINA, VALE, VIAB, WMT, WEN, YHOO, short HYG, IWM.

BRIAN KELLY

Brian Kelly is long Bitcoin, CME, DXJ, GDX, KBE, SLV, TLT, VXX, XLF, XOP, US Dollar UUP. He is short the euro and Japanese yen.

GUY ADAMI

Guy Adami is long CELG, EXAS, GDX, INTC. Adami's wife, Linda Snow, works at Merck.