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Chartology: Critical Week

October 10th – remember that date. It could well be the day the stock market bottomed. On October 10th the Dow hit its intraday low of 7,882 while the S&P 500 also touched its intraday low. What does it mean going forward?

Find out from Oppenheimer chief market strategist Carter Worth.

Symbol
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S&P 500
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According to Worth patterns in the S&P suggest the low of October 10th should stand for a long time. He expects to see a strong advance this week that leaves the index above the 1025 level. “Just as there’s panic on the way down there’s now panic back up,” he says.

Patterns in the ProShares Ultra Basic Materials ETF(UYM) appear bullish to Worth. “I’d play for a rebound in that part of the market."

Similarly, the chart of the ProShares Ultra Oil & Gas ETF (DIG) suggests the risk reward is to the upside, according to Worth.

It’s worth noting that Worth’s buy recommendations are based on a doubling of unemployment rate and the default rate. In other words, even if those negative influences get significantly worse he still thinks the market will go higher. “This is a buyable bottom and play accordingly,” he concludes

You can find Carter Worth’s complete analysis at the end of the Word on the Street video.


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Trader disclosure: On Oct.20, 2008, the following stocks and commodities mentioned or intended to be mentioned on CNBC’s Fast Money were owned by the Fast Money trader; Finerman Owns (GS), (MRK), (JNJ); Finerman's Firm Owns (MSFT); Finerman's Firm Is Short (IYR), (IJR), (MDY), (SPY), (USO), (BBT), (COF), (IWM); Finerman's Firm Owns (OIH) Puts; Finerman's Firm Owns (NKE) Calls; Seymour Owns (AAPL); Seymour Owns (CCJ); Seymour Owns (MER); Seygem Asset Management Owns (FXI), (VIP); Najarian Owns (AAPL) And Is Short (AAPL) Calls; Najarian Owns (ADM) And (ADM) Call Spread; Najarian Owns (EMC) And Is Short (EMC) Calls; Najarian Owns (FCX) And Is Short (FCX) Calls; Najarian Owns (MS) And Is Short (MS) Calls; Najarian Owns (MSFT) Calls And Is Short (MSFT) Puts; Najarian Owns (SNDK) And Is Short (SNDK) Calls; Najarian Owns (BNI); Najarian Owns (TSO) Calls And Is Short (TSO) Puts; Terranova Owns (AAPL), (EXM), (FCX), (FTO), (MA), (NOV), (POT), (X), (VLO); Terranova Owns Dec. Crude Oil; Terranova Owns Dec. Gold;

Terranova Is Co-Portfolio Manager Of The Virtus Diversifier PHOLIO; Virtus Diversifier PHOLIO Owns (IGE), (DBC), (DBV;

Terranova Is Chief Alternatives Strategist Of Virtus Investment Partners, Ltd.; Virtus Investment Partners Owns More Than 1% Of (ABD), (ARE), (BIG), (CNW), (OFC), (DLM), (DRH), (DLR), (EPR), (EXR), (FL), (SLB), (LNET), (MAC), (DBC), (DBV), (SKT), (UA), (BLV), (VV), (CLB), (GWX), (IGE), (FSMXX); Virtus Investment Partners Owns Seagate Tax Refund Rights; Virtus Investment Partners Owns Seagate Technology Tax Refund Rights; Virtus Investment Partners Owns More Than 1% Of Shares Of Incitec Pivot Ltd.; Virtus Investment Partners Owns More Than 1% Of Shares Of Essex Property Trust Inc.