Late Day Reversal, Bullish Signal?

Late day buying flooded the market Friday and sparked a rally that erased a triple digit plunge in blue chips. By the close the Dow Jones Industrial Average average was 10 points in the green and above the psychologically important 10,000 level.

However the modest bounce wasn’t nearly enough to reverse the fortunes of the Dow for the week. In fact, this was the Dow's fourth straight losing week, in a row.

Should investors still be spooked by Greece and the strong dollar? Or was Friday’s late day rally a signal that all’s clear?

Strategy Session with the Fast Money traders

The action we saw late day was very good, says Guy Adami. I think the rally was triggered by investors getting ahead of mutual fund Monday. Make no mistake. A category 4 blew threw Wall Street this week. Now, have we survived or are we in the middle of the storm? Monday will be the test.

I think the storm is past, muses Joe Terranova. I think we learned that the rally in the dollar is what triggered the sell-off. And now I think the sharp selling is over. However, before establishing long positions I’d wait to see if that thesis is confirmed on Monday.

But if I’m right, high beta names that were liquidated this week such as Freeport McMoRan are probably buys, adds Terranova.

I love the commodities names, adds Pete Najarian, but some of those charts are broken. I’m not so sure FCX is a buy at $70.

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KEYS SIGNALS TO WATCH IN THIS MARKET

Veteran trader Gary Kaminsky tells the desk he’s watching for three key signals before he can feel bullish again.

Gary's Correction Watch List
-M&A
-IPO Secondaries Stabilize
-Fed Starts Chatter About Tightening

I’m hoping the AirGas deal announced Friday is an early sign of M&A, he explains. As for the rest we'll have to wait and see.

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PANIC SIGN OF CAPITULATION

Investors spent much of Friday wringing their hands, grappling with the negative impact of a stronger dollar on commodities versus a modest improvement in the unemployment rate.

With the Vix showing that fear is accelerating in the market, should you get out -- or does it suggest a rally is just around the corner?

Widely followed market strategist Doug Kass tells us, “market fears are overblown, sovereign risk issues must be put in perspective and there are signs of life in the labor market! I view this week's panic as an end to the market correction.”

What’s the trade?

When the Vix hit 30, I sold puts, says Karen Finerman.

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CHARTOLOGY – KEY TECHNICAL SIGNS

Considering the bullish action late day Friday, is the selling done? What do the charts suggest?

Top technical analyst Todd Gordon is closely watching the action in the S&P looking for a bounce to get short. "We're still in a down trend," says Gordon.

Find out what levels he says are critical for these stocks to hold. Watch the video now!

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MARKET MYSTERY: NOWHERE TO HIDE

As Fast Money Executive Producer John Melloy wrote in his blog, for the first time in history gold has lost its status as a safe-haven investment.

Despite all the market uncertainty, gold fell to its lowest level in more than three months on Friday, ending the week 2 percent lower.

What must you know?

I’m not one to say I told you so but gold takes the stairs higher and the elevator lower, says Guy Adami. We could be near a level of support, but we’ll have to wait and see.

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Trader disclosure: On February 5th, 2010, the following stocks and commodities mentioned or intended to be mentioned on CNBC’s Fast Money were owned by the Fast Money traders; Adami Owns (AGU), (C), (GS), (INTC), (MSFT), (NUE), (BTU); Najarian Owns (AAPL) Call Spread; Najarian Owns (INTC) Calls; Najarian Owns (MS), Is Short (MS) Calls; Najarian Owns (PFE); Najarian Owns (QCOM) Call Spread; Najarian Owns (XLF) Calls; Finerman's Firm Is Short (IJR), (IWM), (SPY), (MDY), (UNG), (USO); Finerman Owns (AAPL); Finerman's Firm Owns (BAC), (BAC) Leap; Finerman Owns (BAC) Preferred, (BAC); Finerman's Firm And Finerman Own (CVS); Finerman's Firm And Finerman Own (GOOG); Finerman's Firm Owns (KFT), (MSFT), (TGT); Finerman's Firm And Finerman Own (WFC) Preferred; Terranova Owns (BAC), (JPM), (OIH), (GOOG), (EMC), (AAPL), (DELL), (MSFT)

For JoeTerranova

Terranova Works For (VRTS)
Terranova Is Chief Market Strategist Of Virtus Investment Partners, Ltd.
Virtus Investment Partners Owns More Than 1% Of (CLB)
Virtus Investment Partners Owns More Than 1% Of (DLR)
Virtus Investment Partners Owns More Than 1% Of (EXR)
Virtus Investment Partners Owns More Than 1% Of (IGE)
Virtus Investment Partners Owns More Than 1% Of (XLY)
Virtus Investment Partners Owns More Than 1% Of (DBV)
Virtus Investment Partners Owns More Than 1% Of (XLP)
Virtus Investment Partners Owns More Than 1% Of (XLB)
Virtus Investment Partners Owns More Than 1% Of (XLI)
Virtus Investment Partners Owns More Than 1% Of (SKT)

For Will Landers
BlackRock Latin America Fund Is Long (PBR)
BlackRock Latin America Fund Is Long (ITUB)
BlackRock Latin America Fund Is Long (VALE)
BlackRock Latin America Fund Is Long (AMX)

For David Bank
RBC Capital Markets Or Affiliate Managed Or Co-Managed A Public Offering For (DIS), (DISCA) In Past 12 Months
RBC Capital Markets Or Affilaite Received Investment Banking Compensation From (DIS), (DISCA) In Past 12 Months
RBC Capital Markets Is Providing (DIS), (DISCA), (IPG) With Non-Securities Services
RBC Capital Markets Has Provided (DIS) With Investment Banking Services In Past 12 Months
RBC Capital Markets Has Provided (DIS), (DISCA), (IPG) With Non-Securities Services In Past 12 Months

For Mike Khouw
Cantor Fitzgerald & Co. Is A Market Maker In (GILD)

Other Relevant Disclosures:
Finerman's Firm Owned (PLCE) On 1/29/10
Finerman's Firm Owned (MSFT) On 1/27/10
Najarian Owned (BG) Call Spread On 1/5/10
Terranova Owned (BAC) On 1/19/10

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