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After Nearly 500 Point Rally, Will Market Gains Endure?

With the Dow surging nearly 500 points on Wednesday, investors had just one question – can the rally possibly continue?

By the close, the blue chip index had scored its best one day point gain since March 23, 2009 and wiped out all its losses for the entire month of November.

Investors couldn’t hit the buy button fast enough after a coordinated effort by central banks suggested that world powers would prevent the crisis in Europe from getting too out of hand.

”You don't have to fix everything, you have to be on a path towards fixing things," says Tobias Levkovich, chief U.S. equity strategist at Citigroup in a Reuters interview.

"Markets will reward you for the efforts you are making as long as you are moving in the right direction. You get rewarded when you do the right thing, and you get punished when you do the wrong thing."

So -- are Wednesday’s gains a one-off jump -- or can the rally continue into December?

Strategy Session with the Fast Money traders

All of the Fast Money traders agree that the rally probably has legs. How long are those legs? That remains to be seen.

Trader Joe Terranova says don’t fight the central banks of the world. He points to the action at the end of Wednesday’s session, in which markets gained into the close.

”That says to me people are caught short,” he explains. “It’s a powerful rally and I think it forces money managers to act, even if they don’t want to act. Portfolio managers will have to re-allocate money into equities.”

”And look at the action in the Vix,” says Pete Najarian. “Look at how it’s coming down. Fear is coming out of the market. For the first time, I’m seeing a lot of put selling on strong volume.

Guest trader Mark Fisher also expects the rally to continue but he’s not sure for how long. In the near-term he agrees that money managers are caught under-invested. However he also thinks the rally hits a wall. “I don’t know if the rally ends in December or January but I think it ends.”

Only trader Stephen Weiss thinks the market is about to be splashed with cold water. “I wouldn’t get too carried away," he says.

Weiss points to a big EU meeting scheduled for December 9th as the next bearish catalyst. He thinks at that time the market will again see discourse in Europe and grow skittish.

What do you think? We want to know!

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Trader disclosure: On Nov 30, 2011, the following stocks and commodities mentioned or intended to be mentioned on CNBC’s "Fast Money" were owned by the "Fast Money" traders; Terranova is long VRTS; Terranova is long LQD; Terranova is long MUB; Terranova is long AXP; Terranova is long IBM; Terranova is long EMC; Terranova is long SU; Terranova is long CNI; Terranova is long DECK; Terranova is long NCR; Terranova is long HES; Terranova is long CSCO; Terranova is long CAT; Terranova is long LULU; Terranova is long SWN; Terranova is long UPL; Terranova is long TRLG; Terranova is long SBUX; Najarian is long AAPL; Najarian is long C; Najarian is long INTC; Najarian is long AKS calls; Najarian is long JPM calls; Najarian is long WDC calls

For Dennis Gartman
Gartman is long GOLD Futures
Gartman is long S&P 500 futures
Gartman is short euro currency
Gartman's Canadian fund is long of gold
Gartman's Canadian fund is long Canadian dollar
Gartman's Canadian fund is long Australian dollar

For Mark Fisher
Fisher owns CCJ

For Jim Caron
Firm makes market in U.S. Treasuries

For Paul Hickey
No Disclosures

For John Calipari
No Disclosures

For Abigail Doolittle
No Disclosures




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