×

Behind the Money: Investor Mutiny Ahead as Market Loses Its Leader

The Nasdaq is noticeably underperforming the S&P 500 the last two days after leading this stock market since the rebound in March. The Technology SPDR , which is the top performing sector ETF this year, is also underperforming lately. A market without a leader, can't keep going higher, traders say.

"They are killing the generals and now the younger troops are getting frightened," said Dennis Gartman, author of the Gartman Letter, required reading on Wall Street. Citing the breakdown in transports as well, Gartman said today "the bull market is in its death throes, I'm afraid."

Take the five-star general Apple for example. The technology bellwether has put in a bearish reversal three days in a row, falling back below the gap higher open that followed its impressive earnings report on Oct. 19.

"The weak consumer confidence number coupled with weak consumer tech names like Apple has me quite concerned," said Brian Kelly, founder of Kanundrum Research and a FM regular. The fact that Apple broke below the level it opened at post those monster earnings (196.80) means a market breakdown should follow soon, said Kelly.

What's more, bearish bets are increasing against the Nasdaq. Near the end of trading today, Jon Najarian said he was seeing 1.7 puts to calls on the PowerShares QQQ Trust which tracks moves in the Nasdaq 100 index. More normal readings are 1.2 put to call, said Najarian, co-founder of OptionMonster.com and one of the best market timers on Fast.

If an army loses its leader, will it find another general willing to lead the charge? Who else is going to step up right now with the economy treading water? No one else had the cash, growth possibilities and insulation from the credit crisis like the technology sector. What has these traders so worried is that there is no new leader to be found.


______________________________________________________
Got something to say? Send us an e-mail at fastmoney-web@cnbc.com and your comment might be posted on the Rapid Recap! If you'd prefer to make a comment but not have it published on our website send your message to fastmoney@cnbc.com.


Trader disclosure: On Oct. 23th, 2009, the following stocks and commodities mentioned or intended to be mentioned on CNBC’s Fast Money were owned by the Fast Money traders; Najarian Owns (BX); Najarian Owns (GE) Calls; Najarian Owns (LAZ) & (LAZ) Puts; Najarian Owns (MYL) Call Spread; Najarian Owns (RIMM) Call Spread; Najarian Owns (WFT) Call Spread; Najarian Owns (YHOO) & Short (YHOO) Calls; Najarian Owns (STX) Calls; Najarian Owns (CLF) & Short (CLF) Calls; Finerman Owns (RIG), (TGT), (WMT), (WFC), (PDE); Finerman's Firm Owns (BAC) Preferred; Finerman Owns (BAC) Preferred; Finerman's Firm Owns (WFC), (FLS), (MSFT), (PBR), (PDE), (RIG), (PLCE), (TJX); Finerman's Firm Is Short (IJR), (MDY), (SPY), (IWM), (USO), (UNG); Terranova Owns (HES), (JPM), (IBM); Seymour Owns (AAPL), (BAC), (EEM), (FXI), (SBUX)

For Jamie Baker:
JP Morgan Owns (UAUA)
JP Morgan Has An Investment Banking Relationship With (UAUA)
JP Morgan Has An Investment Banking Relationship With (CAL)
JP Morgan Has An Investment Banking Relationship With (AMR)

For Paul Sankey:
Deutsche Bank Owns (VLO)
(VLO) Is an Investment Banking Client of Deutsche Bank
Deutsche Bank Has Received Compensation From (VLO)
(VLO) Has Been A Client Of Deutsche Bank In Past Year

Deutsche Bank Owns (HES)
(HES) Is an Investment Banking Client of Deutsche Bank
Deutsche Bank Has Received Compensation From (HES)
(HES) Has Been A Client Of Deutsche Bank In Past Year
Deutsche Bank Owns (BP)
(BP) Is an Investment Banking Client of Deutsche Bank
Deutsche Bank Has Received Compensation From (BP)
(BP) Has Been A Client Of Deutsche Bank In Past Year
Deutsche Bank Owns (OXY)
(OXY) Is an Investment Banking Client of Deutsche Bank
Deutsche Bank Has Received Compensation From (OXY)
(OXY) Has Been A Client Of Deutsche Bank In Past Year
(SUN) Is an Investment Banking Client of Deutsche Bank
Deutsche Bank Has Received Compensation From (SUN)
Deutsche Bank Owns (PDE)
(PDE) Is an Investment Banking Client of Deutsche Bank
Deutsche Bank Owns (COP)
(COP) Is an Investment Banking Client of Deutsche Bank
Deutsche Bank Has Received Compensation From (COP)
(COP) Has Been A Client Of Deutsche Bank In Past Year
Deutsche Bank Owns (CVX)
Deutsche Bank Has Received Compensation From (CVX)
(CVX) Is an Investment Banking Client of Deutsche Bank
Deutsche Bank Owns (XOM)
Deutsche Bank Has Received Compensation From (XOM)
(XOM) Is an Investment Banking Client of Deutsche Bank

For Peter Schiff
Schiff Is Long Gold
Schiff is Short U.S Dollar