By Roberto Pedone
PEWAUKEE, Wis. (
) -- The traders of
"Fast Money" are starting to see some cracks developing in the markets. On Tuesday's "Fast Money" TV show, Guy Adami told viewers that the financial sector is starting to lose its leadership standing in the markets. He pointed out that
Goldman Sachs Group
are all trading off their 52-week highs. Adami thinks the leadership names in the finical space may be trying to tell us something.
Tim Seymour agreed with Adami but he also mentioned that the markets have still traded in a bullish fashion, with the
closing above the 1,100 level which had been prior resistance. Seymour said the real story for the markets is the dollar and the future implications it will have on interest rates.
Gary Kaminsky echoed those concerns, saying that the most important thing the markets will deal with in 2010 is interest rates. He said we can't have a real economic recovery next year and not be worried about higher interest rates. Kaminsky told viewers that even if we get a hike in interest rates in the short term, we will experience a minor correction in stocks. He predicted that 80% of market movement next year will depend on which direction interest rates head.
Joe Terranova expressed surprise at the amount of pessimism in the markets, with so many investors all calling a top in stocks at the same time. He said there's been a huge rally in the capital markets and it's a no-no in investing 101 to try and predict the exact top. Terranvoa sees more upside in the future for stocks, and he sees no reason not to be confident in the markets.
The "Fast Money" crew has recently highlighted trading ideas that play off the smart grid upgrade, industrial stocks and stocks with unusual options activity. Here are some highlights from over the past week as aggregated from the show.
: How should you play the technology sector in 2010? For insights the traders turned to Pip Coburn the CEO of Coburn Ventures. On Monday's "Fast Money" show, Coburn told viewers: "The quest to dominate the smartphone market will generate some clear cut winners and losers in 2010. I would short
( PALM) and
Research In Motion
: On Monday,
(XOM) announced a takeover bid for
( XTO). The news sparked expectations of a wave of consolidation in the energy sector. Which stocks could be the next takeover targets? On Monday's "Fast Money" show, Jon Najarian told viewers: "I think only the smaller names such as
Plains Exploration & Production
get taken out in the end " The
: The traders have noticed some unusual options activity in a number of stocks. On Monday's "Fast Money" show, Pete Najarian told viewers: "The volume of January calls in
suggests that reform may not be as hurtful to the sector as investors once believed." The
Energy Conversion Devices
( ENER) and
: Legendary hedge fund manager James Chanos, the President and founder of Kynikos Associates, joined the traders to give his perspective on the markets. On Tuesday's "Halftime Report" segment, Chanos told viewers: "Bubbles are best identified by credit excess, not valuations. There is no bigger credit excess right now than China." The
: All this month the traders have been revealing their hottest trades for 2010. On last Thursday's "Fast Money" show, Melissa Lee told viewers: "Spending on smart grids is expected to reach $12 billion by 2013. Also Piper Jaffrey has estimated that the stimulus money will start flowing into the sector in the first-quarter of 2010." The
: Recently, "Fast Money" host Melissa Lee pointed out that the industrial sector was showing signs of strength. She asked the traders for some plays on the red hot sector. On last Friday's "Fast Money" show, Joe Terranova told viewers: "
is approaching a 52-week high but it seems to me the stock could go even higher. I'd be careful if you're short this name." The
Alpha Natural Resources
-- Written by Roberto Pedone in Pewaukee, Wis..
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