NEW YORK (TheStreet) -- The selloff in equities continued on Tuesday as the S&P 500 slid 0.70% and the Nasdaq fell 1.35%.
On CNBC's "Fast Money" TV show, Steve Grasso, director of institutional sales at Stuart Frankel, said the pullback in the broader market has been very small so far, and 1,921 and 1,890 will be key support levels for the S&P 500.
Brian Kelly, founder of Brian Kelly Capital, suggested that investors "wait for the dust to settle" before rushing into buy more stocks.
Karen Finerman, president of Metropolitan Capital Advisors, said she is staying long volatility via the CBOE Volatility Index (VIX.X) -- commonly referred to as the "fear gauge" -- as a hedge against her long positions.
Dan Nathan, co-founder and editor of riskreversal.com, is long Pandora (P) and Twitter (TWTR - Get Report) but has partially hedged his long positions by purchasing put options on the PowerShares QQQ Trust ETF (QQQ - Get Report).
Bob Peck, managing director at SunTrust Robinson Humphrey, has a buy rating on shares of Twitter with a $45 price target. Shares fell 7%, which wasn't helped by the broader market pullback, he said, but a third-party report also attributed to the losses. The report suggested the company will disappoint investors with its data on monthly average users, expected to be near 267 million users. He called MoPub an "under-appreciated asset" capable of generating a lot of revenue for Twitter.
Peck has three top picks: Amazon (AMZN - Get Report), to which he assigned a buy rating and a $425 price target; Facebook (FB - Get Report), which has a buy rating and $70 price target, and Google (GOOGL - Get Report), which has a buy rating and $650 price target.
Nathan is not a buyer of Peck's top three choices. He added that investors could likely buy Twitter near $36 and its monthly active users could actually surprise investors to the upside due to the World Cup, the National Hockey League playoffs, and the National Basketball Association's playoffs.
Kelly said Twitter is likely a buy near $35.
Colin Rusch, senior research analyst at Northland Capital Markets, was a guest on the show. On the recent trademark lawsuit in China against Tesla Motors (TSLA - Get Report), he said it's just a "last-gasp effort" by the plaintiff. He said the Chinese government has already ruled in favor of Tesla and this lawsuit is "99.9% dead." Tesla should continue to show strong growth in the second half of 2014, leading up to the Model X release in the first quarter of 2015. He has a buy rating on shares of Tesla with a $253 price target.
Kelly said the stock needs to hold $215 and said this lawsuit is not a problem. Grasso agreed that shares of Tesla need to stay above $216, which is the 100-day simple moving average. Chinese sales should be strong in the future, he added.
Kelly said Wal-Mart (WMT - Get Report) customers are highly affected by rising gas costs. Because he expects oil prices to fall, he suggested investors could buy Wal-Mart as sales may pick up from the stronger consumer.
Finerman says investors don't find Wal-Mart interesting. Instead, it's "boring and defensive," which makes it hard for the stock to gain upside momentum.
Nathan said Target (TGT - Get Report) has a very bearish chart pattern and if it fails to break out of its current downtrend, then it is a good short-sell candidate heading into its second-quarter earnings report on Aug. 20.
Carter Braxton Worth, chief market technician at Sterne Agee, was a guest on the show. "It's not so good," he said about the technical chart patterns of the Nasdaq and Russell 2000. The indices are having trouble regaining entry into their previous uptrends, which "typically foreshadows further weakness." He suggested that each index could drop by 8% to 10%.
Seadrill (SDRL) fell 5% and was the first stock on the show's "Pops & Drops" segment. Finerman said investors "overreacted" to the company's convertible debt offering, which actually looks rather favorable for Seadrill.
Robyn Karnauskas, biotechnology analyst at Deutsche Bank, said investors should buy Biogen Idec (BIIB - Get Report), on which she has a buy rating and $415 price target. She said the stock does not have a lot of downside risk.
Karnauskas also has a buy rating on Tesaro (TSRO) with a $72 price target. She reasoned that the stock could climb 120% in the next 12 months based on strong management, solid drugs in its pipeline and being a possible takeout candidate. She also likes Arrowhead Research (ARWR - Get Report), on which she assigned a buy rating and $45 price target. The stock has 100% to 200% upside and 20% downside, she said about this "high-risk, high-reward" stock.
Grasso, who is long Clovis Oncology (CLVS - Get Report), said he would rather be long biotech stocks via an exchange-traded fund because he has gotten "burned" trying to buy individual biotech stocks.
Nathan pointed out that a trader performed what is known as a "risk reversal" after he or she sold 10,000 August $13 put options for the CBOE Volatility Index and simultaneously bought 10,000 August $16 call options. The trade loses money if the asset falls below $12.68 on August expiration and makes money if it closes above $16.32 on August expiration.
For their final trades, Nathan is a seller of the QQQ via a long position in put options, while Kelly is a buyer Control4 (CTRL - Get Report). Finerman is a buyer Allergan (AGN - Get Report) and a seller of Valeant Pharmaceuticals (VRX) and Grasso is a buyer of Nordstrom (JWN - Get Report) on a close over $70.75.
-- Written by Bret Kenwell in Petoskey, Mich.