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Around 1360, Big S&P Advance Unlikely: Pros

On Thursday money pros were pulling their hair out, trying to determine if the reversal in the market would push the S&P above 1370 – a level of past resistance.

“It’s on the bulls to ratchet the market higher,” says Fast pro Guy Adami.

After a few days of declines, the S&P 500 reversed direction and rallied to a nine-month high fueled by strong U.S. economic data and increased hopes for a deal on a Greek bailout next week.

Sectors sensitive to economic growth led the market, with technology, materials and financials leading on a day when all 10 S&P sectors finished higher.

After Thursday's gains, the S&P now faces a key level – the 1360-1370 level.

"We really need to churn through this area. We've been here before, we've failed here before," says Stephen Massocca, managing director at Wedbush Morgan in a Reuters interview.

“I’m all about 1370,” says trader Steve Grasso. “That was the May 2011 high. If we can break above, I do think we go to 1400,” he says.

The questions becomes will the market break out?

Largely the Fast Money traders do not think so.

“I think it’s tough sledding from here,” says trader Guy Adami. He feels the market faces far too many headwinds and investors will likely take profits at these levels.

Keith McCullough of Hedgeye Risk Management says much the same. “We shorted the S&P today,” he reveals. And looking at the technicals, he sees no chart patterns that suggest the market environment is making a significant change. “It’s still all about playing ranges,” he says.

Trader Steve Grasso is hearing similar commentary from his clients. They’re saying, “over the next couple of months the market could fall off a cliff and test 1257 – and even 1200,” he says. The thesis is that right now investors are chasing yield but if Europe’s recession get worse, it could ripple across the US economy - and hit the US stock market.

Only trader Tim Seymour is relatively bullish. “Europe in recession is not Europe in implosion,” he says. He thinks at currently levels stocks are just too cheap.

What do you think? We want to know!

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Trader disclosure: On Feb 16, 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 is long ASTM; Grasso is long S; Grasso is long XLU; Grasso is long AVAV; Grasso is long BA; Grasso is long D; Grasso is long DIO; Grasso is long LIT; Grasso is long MHY; Grasso is long NUAN; Grasso is long MO; Grasso is long PFE; Grasso is long PRST; Seymour is long BAC; Seymour is long INTC; Adami owns C; Adami owns GS; Adami owns MSFT; Adami owns AGU; Adami owns NUE; Adami owns INTC; Adami owns BTU

For Steve Grasso
Stuart Frankel & Co and it’s partners own CSCO
Stuart Frankel & Co and it’s partners own HPQ
Stuart Frankel & Co and it’s partners own MU
Stuart Frankel & Co and it’s partners own P
Stuart Frankel & Co and it’s partners own ZNGA

For Mike Khouw
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For Erica Maschmeyer
Robert W. Baird & Co. Incorporated makes a market in the securities of JWN.

For Brad Hintz
Brad Hintz, as a former Managing Director at Morgan Stanley Group (MS), owns an equity position in MS that is held in a Morgan Stanley Group ESOP Trust at Mellon Bank as convertible preferred stock. These MS ESOP securities were awarded to him as compensation and are fully vested. Mr. Hintz is also an investor in Morgan Stanley Capital Partners III, LP — a merchant banking fund where Morgan Stanley maintains an equity interest as a limited partner. Mr. Hintz participates in the Morgan Stanley Pre Tax Investment Plan, which is a deferred compensation plan structured as a note to Mr. Hintz from Morgan Stanley with the return on the note tied to one of many alternative asset classes. In addition, as a result of the complete spin-off of Discover from Morgan Stanley on June 30, 2007, Mr. Hintz received a long position in Discover stock as a beneficiary of the Morgan Stanley ESOP. These shares of Discover will ultimately be distributed to Mr. Hintz by the ESOP trustee.

For Adam Holt
Morgan Stanley & Co. International PLC and its affiliates have a significant financial interest in the debt securities of Adobe Systems, Autodesk, Intuit, Microsoft, Oracle Corporation, Symantec.

For Zach Karabell
River Twice is long GOOG
River Twice is long AAPL
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