By Stockpickr Staff
Posted on May 21, 2009
The traders of CNBC’s “Fast Money” spot turning points in the market by using technical and fundamental analysis and by reading the tape. One interesting piece of technical analysis that has many traders confused right now is the Volatility Index (VIX). The VIX has dropped below 30 for the first time since September, and historically when that occurs, the S&P 500 goes up 6% on average in the following six months.
Jon Najarian is concerned that if too much volatility comes out of the markets, we might see a boring summer trade. Dan Fitzpatrick pointed out that the VIX is still high from a historical perspective, but it’s just not as high as it was six months ago. Guy Adami thinks its ironic that traders complained when the VIX was high and now complain when it’s low. No matter where the VIX heads from here, the traders are still finding a ton of opportunities.
The panel recently highlighted trading ideas that play off of the world’s richest investors, engineering stocks and stocks based in India. Here are some highlights from over the past week as aggregated from the show.
Fast Money’s Options Activity: The traders have noticed some unusual options activity in a number of stocks. On Monday’s “Fast Money” show, Pete Najarian told viewers: “Upside call buying in Anadarko Petroleum (APC) suggests it could go higher.” Fast Money’s Options Activity includes SPDR S&P Homebuilders (XHB) and Wells Fargo (WFC).
World’s Richest Investors Holdings: The new 13-F filings are out that show how the world’s richest investors are positioning themselves in this market. Should you follow them? On last Friday’s “Fast Money” show, Lon Juricic of StreetInsider.com told viewers: “Of course they’re no way to know which positions are bullish and which are hedges, but nonetheless the 13-F filings are a great resource. Look at their moves and cheery pick their ideas.” World’s Richest Investors Holdings include Delta Petroleum (DPTR) and MGM Mirage (MGM).
Fast Money’s World Recovery Stock Picks: The crew sees opportunity in playing some commodity-based stocks for a global recovery. On Tuesday’s “Fast Money” show, Brian Kelly, CEO of Kanundrum told viewers: “You can play the United States Gasoline Fund ETF (UGA) because demand for gasoline is outstripping supply.” Fast Money’s World Recovery Stock Picks include Powershares DB Base Metals Fund ETF (DBB).
Fast Money’s India Stocks for a Pullback: India’s stock market soared 17% after the capitalism party beat the communist rivals in a convincing election victory. What is the trade? On Monday’s “Fast Money” show, Tim Seymour told viewers: “I like Tata Motors (TTM) and ICICI Bank (IBN) on a pullback.” Fast Money’s India Stocks for a Pullback include Infosys Technologies (INFY).
Fast Money’s Second-Chance Shopping List: The traders think investors should have a shopping list of stocks for when the market sells off. On last Wednesday’s “Fast Money” show, Jeff Macke told viewers: “I’m sticking with Ford (F). They’re the only American car company for me!” Fast Money’s Second-Chance Shopping List includes Potash (POT) and MasterCard (MA).
Fast Money’s Engineering Trade: Engineering companies are looking strong after two large firms recently reported solid numbers. On Monday’s “Fast Money” show, Karen Finerman told viewers: “I like Flowserve (FLS) in this space.” Fast Money’s Engineering Trade includes Foster Wheeler (FWLT) and Fluor (FLR).
