Are Stocks Cheap - Or About to Get Cheaper?

On Monday chatter on the floor had everything to do with the market’s gains, after the benchmark S&P 500 rose for only the second time in the past nine sessions.

Investors can’t seem to agree about whether stocks have become cheap enough after six weeks of selling to pour some money back into equities again.

How should you position? What should you be watching?

Instant Insights with the Fast Money traders

Steve Grasso suggests watching 1268 in the S&P, “the low from last week. That held by day’s end even though we broke intra-day.” But if it doesn’t hold he thinks the S&P goes right to 1257 – which is flat on year. “Then the market gets squishy,” he says.

Trader Brian Kelly thinks signs point to more selling. “Gold and silver sold off even with a weak dollar . That concerns me because that tends to be a leading indicator - a sign invetors are thinking sell what you can because things are going to get weaker.”

Kelly is particularly keyed into the economic data due out of Beijing this week. If it’s hot investors will expect China to tighten more “and that will hit the global markets,” he says.

Strategic investor Dennis Gartman feels the same as Brian Kelly. Gartman points to weakness in oil as well as copper and other base metals. “They’re acting poorly,” he says.

Is there any bullish catalyst on the horizon? Joe Terranova thinks the forthcoming earnings season could provide the market with some positive momentum. "If you do the duration of last year’s sell-off and trace it out to this year, it lines up perfectly with corporate earnings and that could be a catalyst to the upside,” he says.

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Trader disclosure: On June 13, 2011, the following stocks and commodities mentioned or intended to be mentioned on CNBC’s "Fast Money" were owned by the "Fast Money" traders; Grasso Owns (AKS); Grasso Owns (AMD); Grasso Owns (ASTM); Grasso Owns (BA); Grasso Owns (BAC); Grasso Owns (C); Grasso Owns (D); Grasso Owns (HOV); Grasso Owns (JPM); Grasso Owns (LIT); Grasso Owns (LPX); Grasso Owns (MHY); Grasso Owns (NDAQ); Grasso Owns (PFE); Grasso Owns (PRST); Adami Owns (AGU); Adami Owns (C); Adami Owns (GS); Adami Owns (INTC); Adami Owns (MSFT); Adami Owns (NUE); Adami Owns (BTU); Finerman's Firm Is Short (IWM); Finerman's Firm Is Short (MDY); Finerman's Firm Is Short (SPY); Finerman's Firm Is Long S&P 500 Puts; Finerman's Firm Is Long Russell 2000 Puts; Finerman's Firm And Finerman Own (AAPL); Finerman's Firm And Finerman Own (MSFT); Finerman Owns (UNG); Finerman Owns (USO); Finerman's Firm Owns (HPQ), (HPQ) Puts; Finerman's Firm Owns (YUM); Terranova Owns (VRTS); Terranova Owns (IBM); Terranova Owns (AAPL); Terranova Owns (CAT); Terranova Owns (BX); Terranova Owns (HPQ); Terranova Owns (MA); Terranova Owns (PEP); Terranova Owns (MCD); Terranova Owns (TM); Terranova Owns (DAR); Terranova Owns (BJ); Terranova Owns (XOM); Terranova Is Short (DELL); Nathan Owns (LNKD) Put Spreads; Nathan Owns (GOOG) Put Spreads; Nathan Owns (AAPL) Put Spreads; Nathan Owns (BBY) Puts

For Steve Grasso
Stuart Frankel & Its Partners Own (ABX)
Stuart Frankel & Its Partners Own (CSCO)
Stuart Frankel & Its Partners Own (CUBA)
Stuart Frankel & Its Partners Own (FDX)
Stuart Frankel & Its Partners Own (GERN)
Stuart Frankel & Its Partners Own (HPQ)
Stuart Frankel & Its Partners Own (HSPO)
Stuart Frankel & Its Partners Own (MU)
Stuart Frankel & Its Partners Own (MSFT)
Stuart Frankel & Its Partners Own (NYX)
Stuart Frankel & Its Partners Own (PFE)
Stuart Frankel & Its Partners Own (PRST)
Stuart Frankel & Its Partners Own (RDC)
Stuart Frankel & Its Partners Own (SDS)
Stuart Frankel & Its Partners Own (UAL)
Stuart Frankel & Its Partners Own (XRX)
Stuart Frankel & Its Partners Are Short (QQQQ)
Stuart Frankel & Its Partners Are Short (AAPL)

For Joe Terranova
Terranova is Chief Market Strategist of Virtus Investment Partners, LTD
Virtus Investment Partners Owns More Than 1% Of (ABAX)
Virtus Investment Partners Owns More Than 1% Of  (AMKR)
Virtus Investment Partners Owns More Than 1% Of (CCG)
Virtus Investment Partners Owns More Than 1% Of (CASS)
Virtus Investment Partners Owns More Than 1% Of (CSVI)
Virtus Investment Partners Owns More Than 1% Of (EXR)
Virtus Investment Partners Owns More Than 1% Of (FCFS)
Virtus Investment Partners Owns More Than 1% Of (IGE)
Virtus Investment Partners Owns More Than 1% Of (KRC)
Virtus Investment Partners Owns More Than 1% Of (LDR)
Virtus Investment Partners Owns More Than 1% Of (LHO)
Virtus Investment Partners Owns More Than 1% Of (NRCI)
Virtus Investment Partners Owns More Than 1% Of Sun Pharmaceutical Industries Ltd.
Virtus Investment Partners Owns More Than 1% Of (DBV)
Virtus Investment Partners Owns More Than 1% Of (XLB)
Virtus Investment Partners Owns More Than 1% Of (XLV)
Virtus Investment Partners Owns More Than 1% Of (XLP)
Virtus Investment Partners Owns More Than 1% Of (XLY)
Virtus Investment Partners Owns More Than 1% Of (XLE)
Virtus Investment Partners Owns More Than 1% Of (XLF)
Virtus Investment Partners Owns More Than 1% Of (XLI)
Virtus Investment Partners Owns More Than 1% Of (XLK)
Virtus Investment Partners Owns More Than 1% Of (XLU)
Virtus Investment Partners Owns More Than 1% Of (SUBK)
Virtus Investment Partners Owns More Than 1% Of (WDFC)
Virtus Investment Partners Owns More Than 1% Of (YDNT)
Virtus Investment Partners Owns More Than 1% Of DOMINO'S PIZZA UK & URL PLC

For Brian Kelly
Accounts Managed By Brian Kelly Capital Are Long U.S. Dollar
Accounts Managed By Brian Kelly Capital Are Long New Zealand Dollar
Accounts Managed By Brian Kelly Capital Are Long (USO) Puts
Accounts Managed By Brian Kelly Capital Are Long (MON)
Accounts Managed By Brian Kelly Capital Are Long (DBA)
Accounts Managed By Brian Kelly Capital Are Long (IWM) Puts
Accounts Managed By Brian Kelly Capital Are Long Hong Kong Dollar
Accounts Managed By Brian Kelly Capital Are Long (MUB) Puts
Accounts Managed By Brian Kelly Capital Are Short Australian Dollar
Accounts Managed By Brian Kelly Capital Are Short Euro
Accounts Managed By Brian Kelly Capital Are Short (JJC)
Accounts Managed By Brian Kelly Capital Own Hong Kong Stock Exchange

For Gina Sanchez
***No Disclosures

For Dennis Gartman
Funds Managed By Dennis Gartman Own Canadian Dollars, Australian Dollars, Swiss Franc
Funds Managed By Dennis Gartman Own Gold
Funds Managed By Dennis Gartman Own Wheat
Funds Managed By Dennis Gartman Own Corn
Funds Managed By Dennis Gartman Own Soybeans
Funds Managed By Dennis Gartman Own Crude Oil
Funds Managed By Dennis Gartman Are Short Yen
Funds Managed By Dennis Gartman Are Short Euro
Funds Managed By Dennis Gartman Are Short British Pound Sterling
Funds Managed By Dennis Gartman Are Short Natural Gas

For Andy McOrmond
***No Disclosures

For Doug Kass
***No Dislcosures

For Amelia Bourdeau
***No Disclosures

Fast Fire SOT: Joe Terranova 5/9/11
***No Disclosures

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