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from the nasdaq marketsite from new york city. hi. welcome to america's post market show. rick santelli in for melissa lee. these are the "fast money" traders. is the rally running out of steam? deja vu all over again a. hot topic. pete, do we have a definitive answer on this? >> i don't know we can. if you really look at the volume today, the volume is extremely light. option volumes have been really very, very strong. even when we see the stock market coming down. today, option volumes once again. it's trading 15 million contracts a day. today we barely broke 10 million. so risk aversion has been sort of the topic that everybody's been talking about today. looking at the markets, when you look at the markets, there's a little bit of a rotation, maybe into some of the lower-risk style trades. they've gotten a good bang for their buck over the last year or two. you got to like the earning cycle. you like to look at the ranges. look at news corps, sales near 50. oih, sales near 110. people are playing these ranges, they are playing the charts and so far the charts are working.

>> techs always seem to work, don't think, guy? >> clearly the market's got me perplexed but a couple of things don't. hartford financial, you go back to their earnings report on july 29th. they said they will be profitable this year. they might make $3.82 next year. why i do i mention it? the stock closed at 15. listen, i said it probably won't go to 30 but may go to 23. it got there today. it may go higher but i'd be taking profits. burlington northern, the other one who got me by surprise today. you had an analyst in addition with a $100 price target and on a benign tape, that stock was down big with the rest of the rails. two things to look at, i think the rail move is very interesting. >> i tell what you, a lot of people are talking this week and they're talking about the economic numbers and they're saying that correction is coming. be careful with that trade, rick. be careful. you want to know why? next week, first week of september, what do you get, ism manufacturing, minutes and unemployment on friday.

all three of those setup potentially to be very positive reports. >> you're right. especially ism, even though it's a smaller -- >> about 50 potentially. >> rick, i do think this week might appear on its face to be somewhat insignificant in terms of volume as you mentioned, not big price changes but there are significant things going on beneath the surface. i think what the bulls have to worry about most here, they lost their general, the leaders of the bull's army have been shot. and i'm talking primarily about the nasdaq, which is badly lagging the s&p, and china, which is not only lagging but outright trading lower. when an army loses its generals, it's a sign of trouble. >> and he brings up a good point. nobody wants to talk about china because we're in the bull market. listen to what the rhetoric came out of china. they said, maybe things aren't as rosy as they look like. meredith whitney makes negative comments about the financials. again saying the markets are overextended here. >> sugar buzz is the perfect analogy. who knows -- >> everybody discounts it. nobody is taking this into consideration. six months ago we would have gone down on those.

>> guy, building on that remark, i'm a firm believer in the norm normal and that has not proven through so far. but i think fading el arian's tracker is dangerous. i believe in the thesis they have been promulgating that the consumer is in for years of restraint. >> i think i will have to give you some debate on a future date on that one. let's take a look at the chart of the day. forini pointed out that after the last two recessions, stocks did not have a big correction. they rallied 95% after the 2003 recession. joe? >> let's talk about the 2003 scenario and let's bring together the tremendous amount of pessimism that everyone has about the market. let's not talk about the economy for a second. let's talk about the market because, rick, that's the scoreboard. that tells you what the score is. >> that's the only score that matters. >> absolutely. what happens here? you have as the hedge fund community comes back in september an overwhelming bearish tone. everybody's looking economically. everyone wants to be sellers. what does that line up for?

it lines up for similar to 2003, a potential end of year chase for performance. 2003 from thanksgiving until the end of the year, you tack on another 11% on the dow and it lines up for that to occur again this year. >> one thing quick, guys, the one thing about these charts i have to tell you, the 1990/'91 recession ends and he's right. it goes up a couple hundred percent. but you had to wait five years before it really took off. it was flatline. america, would you consider that victory in the environment we're in? i say no. >> joe, i would just point out i think a key difference between now and 2003, the fuel that really got that rally going was the bush capital gains cut, i mention thad yesterday, and the market actually flew from there. we're in the exact opposite scenario now. we're looking to raise taxes and raise taxes on the most productive people in america. so i don't think the analogy holds and i don't think he's onto anything. >> the sustainability of the rally is what you're actually drawing the analogy to with the

bush tax cuts. does that mean you can have a market rise like we did in '03 to '06? probably not. but what's in front of you right now is a tremendous amount of capital sitting on the sidelines and it's going to be allocated to this market unless you get this deep pullback, and you're not getting it right now. so you don't get the pullback. people are coming in. >> follow the money. follow the money. >> the last thing is on this whole general economic topic, it all comes back to unemployment. when you look at those numbers, we have to see those turn. and the market is truly in a turn. >> have you to have a job to buy toasters. you need to have a job to buy cars. i think some people out there might disagree with that nowadays. >> we talked about some of the ideas on the death car sales. but there are ways we can maybe use that in job creation and that's sort of where we need to go for the next level. we have stimulated the economy. now we're at this level. now the next thing is, we've got to see these jobs come back. >> speaking of house and mortgages, new home sales jump

10%. guy? the new number is the lowest number since april of '93 or something ridiculous like that. and split of homes was about 6 1/2 or 7 months, and i think it was 10 months in january. >> right. >> and that's good news. something steve was talking about last night, we talked about on this show, the savings rate continues to go higher in this country. i think that's its own stimulus package. people will wake up and feel better about things. they will buy but don't think we're there yet. >> look at the shb, we were talking about that yesterday. that's not really the housing index people think it is. look at what pushed this thing higher today -- it was williams sonoma, bed, bath and beyond. it got through 16 today. it did pull back but those names are what's pushing it right now. they're get some boost for one or two of the housing names but it's a lot of the housing name suppliers that are pushing this up. >> consumer finance and consumer banking. it's those that hold the loan of the consumer because you are seeing the wealth effect. the consumer right now, their balance sheet is actually strengthening with the end of

this bursting of the housing bubble. >> oil stocks down 1%. oil -- i'm sorry, down 1%. oil stocks hurting, wish they were down only 1%. joe, what's the score there? how much were they down? >> real quickly on oil. we talked last night. there was this reverse. remember, we got up to a ten-month high of $75. i am not ready right now to say that the commodities trade is over. you have a great point of reference in the oil futures at $68. against that on the pullback today, i bought exxonmobil. i bought sun corp. and i bought weatherford. i still believe in the oil story and the commodity story as we work towards december 2009. >> they already had a move last week ahead of that move, halliburton, incredible option activity out there. as well as weatherford. they moved in front after the options activity and last week you look at the oih, 99, got up to 110. failed again. here it is again at 108. i think you'll have an

opportunity for that index to pull back, maybe get in even better levels, pushing back towards 100. you might be able to see something like halliburton, weatherford, diamond offshore, some of names a little better for us. >> china's been stockpiling things and they may be done stockpiling. you have to be very careful with commodities here. >> let's see an oil chart. i tell you what, guys, i still like to dabble with charts. here's what i find interesting. outside day, it expanded and took out some key highs and in the previous day's lows, took it out. normally, that's a trend reversal. but like anything in life, it's what i call the senate shot perspective. it is more important is the weekly close and more important, we will see how it looks at the end of the week and month. and then we will have this conversation again, joe. what do you think? >> absolutely. we will have this conversation over an over again. i still think the trade has been throughout 2009 on any dip. you buy oil, until proven wrong, you go with that theory. >> of course, the stories all today -- you know, when i walked in this morning, every e-mail was about that story, whether it

was about steel, all of the cutting back. it's time to go trading the globe, china. will they pop their stock market bubble? this is a hot topic, whether it's commodities or the breath of the moving stocks. i think steve is the guy to enlighten me on this one. >> rick, i think there's two key points here. one is china is tightening day facto. and the second thing, this story, brings it home, this idea that china through a centrally planned economy, that beijing can be this onlyish shent architect, and we are seeing beijing and the beijing democracy could decide how much steel they can buy, how much stock they can sell, how much they can borrow. it's an implicit problem in china. central command does not work in their economy and it certainly won't work in ours, either, even though we're inching that way. >> you're reading my mind. >> if you're looking at china, if you still believe there's anything in china. any middle class growth. and forget the stock market. we all know the stock market is a different animal altogether. you look there, if you're seeing

growth, i still go back to the infrastructure plays and i still go back to the some of the names in the energy phase. they had a huge run. i think can you get them at a better level. you don't need to chase them. this market taught us one thing, this is a trader's market. you don't have to chase anything. but you look at these names. but you look at fluor, you look at foster wheeler, you look at the shaw group, all of these various names both infrastructure and energy plays, power grid, all of that. you got to like that if you believe anything about some of the numbers out of china. >> rick, would it surprise you in the next couple weeks to see china down 8% to 10% overnight? it wouldn't surprise me at all. what happens if that happens to our stock market, can't be good. what happens to the commodity market? can't be good. i think that days coming and i don't think people are talking about it f. >> i think you're right. >> the china tie-in, too, which we were talking about, oil. one reason i don't believe in oil is that the shippers have not been moving at all. tk, fro. these have been boring for weeks and weeks. i don't believe they are consuming it at the rate the market was previously.

>> i totally think the difference here that we're talking about is when you look at china, we're not talking about market performance. we are talking about economy and china will grow a double digit going forward. forget the market performance. that is not what our domestic markets are correlated to. if you look at china, look at the ability to be the best in breed in terms of the economy. how come when oil pulled back to $40, the united states was not a buyer? we were not filling our sbi. i tell you what, china was doing it. they were taking the opportunity and lowering prices to stock commodities -- >> on every corner. >> every corner. >> what does that tell you, rick? it tells you china basically has us in a position economically. they want. they will squeeze us. >> do you believe a command economy will overcome american entrepreneurship and innovation? >> no. but during the time you need to stockpile, when they're still talking windmills and solar, which is great 10, 15 years down the road, why are we talking about putting these cars on

natural gas? we have boatloads of natural gas. what's the price? the conversion. see, sometimes central command is better because of the political inefficiencies of bureaucracies but we are capital market. >> just to wrap it up, you have to applaud the chinese, recognizing when commodity prices got so low in february and march, they stepped in, they were buyers and you know what, they were right. they weren't like the united states a couple years ago as oil was going to $140, the united states was buying it at $120. >> and buying it and picking on all of the traders in the world because it was their fault. yeah, right. prices hold steady. after today, i found this auction yesterday. interesting. i find the pfizers the darling. everyone i talked to, they were into the five-year, butterfly, curve trade. five-year went well. maybe the round rim and square tire comes with the seven-year auction tomorrow. i can't tell you. hey, guys, it's pretty good. >> you gave them a pretty good grade today. right? >> i gave them a b-plus today. >> and you think the bond market and stock market can go in collaboration with one another? you think stocks can go higher

in this type of environment? >> i think they can flat line together. >> or flat line together. frankly, at some point there's going to be some divergence, i just haven't figured out which way it will be. i think stocks will head lower but other people disagree. >> i actually disagree with something you said today. you said indirect bidders, foreign, central banks, you couldn't figure that out. i truly believe, rick, they are the ones right now who are buying this stuff. we have to look at them. indirect bidders, if that goes down, that's a problem. >> it is. >> the reason i said that's an issue is because if the dealers are taking down this supply and we have buybacks a couple of weeks later when they daisy chain this and end up buying it back, i'm not sure what it means as a metric for the auction. it's getting purchased. but in the big picture, you're right, because we need those numbers be, those foreign central banks and those large institutions, even though steve tells us domestic demand may pick up. next trade -- how do you trade bernanke's second term?

on the path line is critic of the fed. >> we all know he's written some interesting books. here he is, bill, what do you think about what's going on? give me some trades. i know what you think about mr. bernanke and the fed. tell mel a trade to make money. >> well, thanks for having me, rick. i'm a big fan of yours. >> thank you. >> and everyone was just talking about how nobody believed in central planning but everyone believes in the fed, which was just central planning about printing green pieces of paper. since i believe they're going to print more of them, i think the dollar will be weak but other currencies will be too. i'm long gold. i'm long silver. i'm long gold and mining stocks. i'm long some companies that do exploration for that. >> i'm sorry, billy. what do you think about the u.s. equities market? what do you think about the s&p here? too much too fast? or are you just sort of avoiding it? >> you know, i'm kind of agnostic, guy. all year since i closed my short fund in march, i haven't been

short. i was afraid -- i knew money printing would come along. i figured they would print as much money as they needed to float the boat for a while. i don't know how much of the economic activity is real. some of it is. given all of the money printing, i would rather capitalize on money printing, which i have confidence will continue if things get weak, and if they don't get weak, they'll still keep it up rather than try to make an investment based on gdp activity because we're not going to be able to create any jobs for quite some time. so i'm long money printing, and i don't care about stocks. >> bill, more directly, getting back to stocks and i apologize i got to go there. that's where my world is right now. technology. for a long time you were bearish on technology. technology has had an monster run since it started with intel and ibm and all of the rest. what's your feeling on technology? do you think there's still any upside? do you believe in any growth? or do you think these are a short? >> well, a couple of smaller tech names that i actually own but i don't want to get into them because they're tiny.

but i think generically the names you guys talk about and traffic in, i think these companies have set the bar low enough, i think their quarters are okay because of the restocking that's gone on and maybe double ordering. i think maybe for this quarter and the outlook, these stocks will be okay but they don't represent any value. they're just tickets to play let's beat the number. so i think -- >> it's all about that. it's a paper chase, isn't it, bill? listen, we have to -- we're going to have to run. it's been an absolute pleasure. you have to come back and we have to dig into this deeper. here's what's coming up next on "fast, fast money." the back-to-school trade, will dell be a dormroom staple or will apple be the big man on campus? and the correction was supposed to start yesterday. we peer to the charts for clues on when this gravity-defying run will end when america's postmarket show continues.

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welcome back to "fast money." aig, fannie mae, freddie mac, all beating things like goldman shares this month, percentage wise, of course.

is this a sign of a bull market or bs? gary kominski, formerly of new burger berman. what's your take? >> the way i look at it, it kind of reminds me of the period 1999. and if you remember what happened with the technology names, when everybody had to own the jf uniphase, qualcomms, nort nortels, you're running into a situation now where when i talk to guys who are actually managing money, they're basically telling us, we have to own these names. have you to participate. it's what i always call closet indexing, i don't think that's a really good sign. i think when you start to see -- obviously coming out of a recession, the lower quality names are going to perform better. but you're in a relative performance game right now which i think is very dangerous. >> all right. here's the deal, today fdic formalized some of the rules about private equity getting into the system. do you think any of these aig shares or some of this is improving because there's some bridges built? maybe some of the portions are going to be purchased? maybe that's why it's being written? and the second thing is, who owns all of the shares of

freddie and fannie? the government, right? give me my shorts back. >> the way i look at it, you know better than i do in terms of what's happening with the daily flow. what i know is active money managers who say they're active money managers but at the end of the day they're closet indexes are buying these shares simply because they're participating and they're performing. they're basically doing the same thing they did in '99, which is they felt good having cash, march, they felt okay participating in the higher quality names in april and may. and what i think has happened in the last couple of months is let's just jump in because we can't take the chance later this year on the performance. >> you think they're chasing at the top but how much longer can this go on for? six months, six weeks, six days? i'm sort of perplexed here as well. i'm sort of in your camp. >> well, i think the time period that i kind of go back to and try to say, what was this most like, again, as i mentioned was '99. we all know late '99, many of us sat there and said we can't believe what's happening and it carried through until early 2000 and then, boom, you know what happened.

so as we're in this time period where you're getting close to the end of the year, a lot of these guys have made no money in terms of performance, getting paid for performance last year, are going to keep it as much as they can through the end of the year. so september, october, historically bad time periods for the stock market, i think the worse businesses are going to outperform -- are going to outperform in the short term. but i want to be very concerned. i want to be very cautious. i think people who have to go back and start thinking about where were we a year ago? yes, we made a nice catch-up. we made a nice move. but we virtually did nothing in most prices in a year. >> they're chasing performance. but most of these guys are on the sidelines. what sort of an upside when you talk about dash for trash, is it citi? too late to chase citi? bank of america isn't even a trash. do they have to earn it? >> i bought a little citi myself in march and i bought bank of

america and i went on cnbc and let me tell you, i felt very, very lucky. >> but you have low risk for a fair return and these guys are chasing returns for no returns right now. >> owning those names back in march, april was like buying a call option. >> sure. >> to buy those names now and not put in a stop order if you're trading i think is crazy. the fact is when this turns, and we know it will turn at some point and people start to say, we're not -- we're not in this strong economic scenario that a lot of people have painted. rick and i spoke about this last month. you need to be worried about protection, much like if you were worried about protection in august and september last year, you were okay. >> gary, i agree with you. but it winds up hedge fund communities coming back from the beach, right. no one believes the rally. september comes. hedgies will fight this thing. they will get short in september again, don't you agree? >> the hedgies i know are the same guys you probably know and they're all saying the same thing. we're holding our nose. we're participating because we feel we have to. but at the end of the day -- i

saw in the "journal" today you saw goldman sachs analysis what the hedge funds are all buying? they're buying the same financials. just like '99 with technology. >> i agree with you completely. what will be the catalyst? how will we know? what will be the sign this dash for trash is over? >> i think as soon as it becomes apparent to market participants that the economy is not going to grow, is not going to have any real growth in the first quarter of next year and people start focusing on the fact with all of the stimulus and all of the money being printed, it will be back to the reality of we're going to be in for a 2010 with very little economic growth, and what companies did to achieve profits and to achieve results in 2009 is not going to sustain us next year. >> so are you saying you're convinced there is no growth next year? is that what you're saying right now, you don't see any possibility for growth? >> as recently as this afternoon, in talking to people who hold real estate in arizona, what does wall street think?

there is no recovery. we are starting to see the next leg down. so while i don't see a tremendous downside in the economy, i don't see -- you know, i don't see a negative five or a negative four gdp print, what i do see is no growth because i don't understand how with all of the money we printed and all of the stimulus pushed into this economy, why we're not seeing more -- >> i agree. >> -- bottoming out. >> maybe we buy lumber futures and that trees and paper have to come from somewhere. you have to come back. especially when we see you're right and the growth isn't there. it's been fun. you're the man. >> absolutely. >> rick, quick on this point, i believe the money managers, the asset allocation stops when you turn the page on the calendar, it's 2010 and we now don't have to chase performance. we are basically flat for the year in 2010. that's where you see money managers saying, i don't have to be in this thing. >> are they going to be around when they didn't have any performance, these money managers? are they going to be around? >> that's why they're in there right now saying, i got to make sure. one bad year is okay. not two, you can't have two in a

lo row. >> i agree. in the '99 recession chart we just talked about, flat line for four years. but the venture looked great, right? but you had to wait ten years. >> the game of chasing performance is incredibly dangerous, though. i think we're in that scenario now. my guess is it's not the end of the year. i think it's the next couple of weeks. most smart folks i talked to seem to think it's after labor day. i think it's next week. i think we're very, very close. >> trail those stops. buy a few puts. talk to peter. options, monsters. time for trade school. not all pairs. steve cortez, break it down. the odd couple trades. >> the odd couple, yes. talk about paris trades and paris trades for two reasons. one is the method of speculation. relative value of spreading two stocks normally which are similar. buying exxonmobil and selling chevron against it or as a method of protection, as a method of hedging. i will give two examples, one of which i have already done and one of which i'm looking at doing. the first one is goldman sachs. it's been very profitable.

the only stock i have owned for most of the rally. i think the market is frothy so i want protection. i don't want to sell goldman sachs. the reason i own that is best in breed within that group and best price action. what do i sell against it? i sell today jpmorgan against goldman sachs. the reason being very similar company but very different in this regard, jpmorgan has exposure to the consumers. secondly, mortgages, credit cards, i don't want any of that exposure. goldman does not. jpmorgan -- goldman is almost jpmorgan stripped of that element. >> goldman sachs is gloria, jpmorgan blanche for all of you odd couple fans. you also have to know what he's rooting for. i like what he's saying but i think you will probably be short jpmorgan here with a tight stop. goldman sachs, i think got too frothy, this 165 give or take level. we sort of moved around here for a while. i would rather be short jpm outright. take my shots at goldman sachs lower f.

>> i don't disagree. i will tell you this, if the market starts to go lower, i will start to skew that. right now dollar for dollar, i will get shorter jpmorgan on the way down. >> and past trades, you can do sectors as well, rick. take a look at resources, commodities, which are obviously getting beaten up lately. and what do you want to do? discretionary, take a look at the travel and leisure names. those are the names you want to short against what we believe will be the beneficiary at the end of the year, commodity resources. >> that's a great point you brought up that we missed out on the first part is, what kind of percentage? you're saying now one to one. >> balanced. >> but a ratio, you have another one for me besides goldman and j.p.? >> second one materials. i do not believe the material stories. the trade recently, this just very week, is troubling coupled with china and china's trade in august. i think selling xlb, the material spider, makes a lot of sense here. buy in the market. you can do relative performance or non-performance on the sector in the market. i haven't done this one yet. something i'm looking into. selling materials, buying spy.

>> and this one is the pigeon sisters are both short, so -- >> the segment is about paris trading. time to take your position. dell reports earnings tomorrow afternoon. do you buy or sell ahead of the number? here with the trade is ubs analyst maynard om and here he is on the screen. maynard, welcome. what do you think? do we buy? >> rick, i'm not a buyer here. i'm still concerned about the i.t. budgets going into the back half of this year. i think they're going to talk about stabilization in the overall market but if you think about this going into the back half of the year, pcs are still low on the totem pole in terms of ip spending priority, and i think best case scenario is stabilization of i.t. budgets. so 80% of their revenues are coming from the segment so i still think there's risk going into the back half of this year. >> maynard, the stocks had fun but they talking about margin pressure on july 13th. i think the street is looking for 17 1/2%. that to me will be the tell for dell.

>> that's exactly right. i think as we go into the next quarter, i think all guys will be on commentary about those gross margins. i still anticipate more gross margin pressure and i think the reason why here is pc is commoditizing and that's the core of their business. as we go into next year, you will see more competitors, guys like hp that will be more aggressive in the enterprise market, which is the core of what they're doing. if they do mix shift more towards the consumer market, remember the indirect channel is also a lower margin product. >> i have a question for you here, speaking of margins, the netbook issue. it's significant. the investment community is concerned about it. dell is doing well selling cheap notebooks but will it cannibalize their higher margin notebooks and pcs? >> also remember the netbook is only about 10%, less than 10% of the overall pc market. i think as you look forward, i think really what you need to look at is more of the consumer pcs. here's my thesis -- my thesis is that the market next year for consumers will be driven by fashion pcs. it's sort of like what motorola razor did for the handset market

in terms of industrial design. i think you will see something similar. the issue is that you don't buy fashion items online. you buy them in store. you go touch it. you feel it, right? i think that's the issue dell has. i think they got to grow that indirect channel, and that indirect channel is a lower margin product. >> you're right, maynard. my daughters will buy anything if you put a pink case on it. steve, you have any thoughts? >> maynard, will they do what everybody's been hoping for them to do and look for them to do in some sort of growth fashion, by doing some sort of acquisition? question two, you're neutral on it now. why would they have to do to put it in the buy rating? >> i think what they have to do is transitional rating. if you look at the long-term, the pc and hardware business will continue top commoditize. >> who should they buy? >> one of the names we've been talking about is pearl systems, on the services side, we think that's a good fit for him. it's a question whether ross perot will show his 25% voting share into it. i do think they need to move into the recurring revenue and hiker-margin business.

would i like to see a quarter when the margins get hit and revisit the stock. that's my primary concern. over the longer term, i would like to see them do something on the m & a front. >> would the m & a front be enough, though? forget the other stuff, if they actually did the m & a to show they're really committed to the growth, would that be enough to get you into the buy rating camp? >> i think it depends how big the acquisition is. i think they've got to do something transformational that will change this company almost overnight. >> maynard, let's not beat around the bush. the name is palm. will they have to overpay for palm here? >> i didn't go there. >> but that's it. >> i don't think that's actually a good acquisition. i think that's totally away in the core of their business. i think it's in the focus that is absolutely nothing to do about what they're really doing today. i don't think it adds any value to them. there's no synergy between what palm is doing and their os to what is the core of dell's business today. >> that is transformational, though. >> a lot of these computers are

wearing out, though. wearing out, though? my kids are tough on them. there's a certain cycle here and i think that's going to be good. and dell is at the top. >> and these phones, one thing that's a missing link, when you're talking about the iphone, it was never about them making money on the iphone. they're doing a tremendous job there. doing an unbelievable job with the application. but it's really about feeding people right into the mac. 2.5 million every quarter. >> dell can pull it off. here's what's coming up next on "fast money" -- >> this rally has everyone backtracking, so when is that correction coming again? we see what the charts have to say next. paws. check. bottom. needs work. sorry, son. [ female announcer ] you can't pass inspection with pieces left behind. new charmin ultra strong. it's soft and more durable.

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welcome back to the big second half of "fast money." here's what we have coming up. pete, you're going to spot some hot options for me in the biotech stock area. hey, some of these are up 200%. >> unreal, ron. unreal. >> incredible. we want viewers to make some money on it. talk to me. >> we're going to figure out some ways to do that. but the options activity out there have been incredible. we will cover that. you know what else we have, we will check the charts on oil. joe will enlighten us there.

wall street, which oil made billions off the subprime. think about who this might be. he had a pretty good day today and this is kind of our quiz for the day. see if you can guess who it is. first, my favorite part of the show, pops and drops. diamonds and bow wows of the day. let's get started with -- well, dollar tree. up 5%. the earnings were up 51%. they got into the whole grocery space and says a lot and unfortunately says a little about our economy right now. when dollar tree is doing well, that does say something about the direction we're in. >> we talked about shorting bni yesterday and today, they were o outperforming raymond james. i think they go lower. >> williams-sonoma, 11% pop. >> it was a beat on the earnings and guidance going forward. i'm not enamored but it's a bullish story. >> the liquidator. >> the street is beating up morgan stanley now. highly critical of them not having a strategy. folks, they have the strategy.

number one in m & a. for the first quarter of this year, they are adding to the thick trading. i will tell you, what everybody's forgetting about smith barney. how about that acquisition? you will see good revenues coming forward in the next few quarters. >> next, pop for beer, budweiser. miller lite and heineken, get this, all raising prices because sales are slow. these guys ought to be in politics. >> they're not going to be slow for long because you have football season coming up. the start of football season means beer sales will come right back. you know what, we don't care what the price is. we will still buy beer. >> i know. normal li when sales are down, you don't raise prices. >> they do, and it's going to work. let me tell you something, people don't care. >> the guy was rude to trade here. one of the reason is costs have gone up so much. and they're basically talking about the grain and also water. i believe in water trades. it's a scarce resource you have to invest in, be, french water company. biggest water utility in the world. the french use more water than any other country per capita except for the united states, which belies the stereotype that

they don't bathe enough. it's not true. be is a stock i like, beer derivative. >> i never thought would i have this much willpower. pop 2%, guys? >> morgan stanley, the better stock to own is hg. >> and another pop, what was it, 5%? >> 5%, chinese solar company. if it has china in it, i don't want it. this stock was at $75 five years ago. now it's at $9. >> jacobs engineering? >> i thought this was a downer. >> it was a downer? i will tell you what, stocks trading $45. it was above $50. you want to be long. >> final pop, for all of your trekkies out there, they are going to make "star trek" cologne. remake, great movie. you can now wear the scent of the trekkie. you know what, i have a feeling guy will have something to say about this. >> i have the ad. zoom in here on me, folks. "star trek" cologne, you, too, can go where no man has ever gone before. >> is that good or bad? oh, my god. spray me up, scottie. don't move. lots more "fast money" coming

up. on tonight's trader radar, we look at the stock lighting up screens across wall street today. originally a toy seller, this company spun out of that division, naming it kb toys. now it focuses on getting more bang for your buck, acquiring names like dollar bills and greenbacks over the years. shareholders are finding today that maybe money does grow on trees, as the stock grows on a 50% jump in second quarter earnings. who is it? the answer when "fast money" returns. i'm here on this tiny little plane, and guess what... i've still got room for the internet. with my new netbook from at&t. with its built-in 3g network, it's fast and small, so it goes places other laptops can't. anything before takeoff mr. kurtis? prime rib, medium rare. i'm bill kurtis,

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on the trader radar tonight -- dollar tree. the largest retailer of items costing a dollar or less was among the most active names on the nasdaq today. welcome back to "fast money." hey, lots of people calling for a correction. it's the topic almost on every show but it's important. let's see what the charts say because the charts are sometimes right. okay. even though at the bottom of the ocean there's a lot of ship that are sunk and they all have chart rooms. chartology is what we call this. greg is the man who will give us a tour at what he sees at the cnbc chart center on the s&p chart.

take it away. >> great introduction, rick. the testosterone flowing on the desk today, huh? >> certainly is. >> let's take a long-term look at the s&p monthly. the high dating back to october 2007 was around 1576. 18 months later we came all the way down to 666 on a continuation chart, which is kind of odd. i don't know if people realize that. we thought we were going to hell and we actually hit 666 on the s&p. since then in the last six months, we've rallied up to above the thousand region and at 1123, that is a 50% retracement of that entire 18-month slide. so within six months, we've practically made up 50% of this. that's the reason i think people are wondering where the correction comes in, rick. are we need a top here near

term. and i think that 1123 area is very critical. we came within 90 points of it. so anywhere between 1040 and maybe 1090, we're certainly into a key recession. >> what do you think? >> first, i want to ask you the cnbc chart center, it sounds like it's norad with the pentagon war room. >> go attitude and longitude. >> let's get more specific.. it's easy to say 1040ish. where do we get short? where do we risk? >> fine. let's look at the daily. let's turn to a daily chart right now. because now we're going to micromanage this a little bit more. keep in mind from the march lows to where we are today, my 21-day moving average line, which is a key indicator for me, it has been in a positive slope other than eight days since march. we've had congestion here over the last couple of weeks that we broke above, and we're now starting to stall. i would say that if we are going to actually have a key reversal here or any sort of indicator where we're coming below the recent lows of the last three weeks, i would need to see it on a downside confirmation. me for to try to sell into strength is kind of a futile endeavor now. i want to see weakness.

i'm not going to try to be a hero. >> i love 21. what do you think of the chart? >> the nasdaq chart to go back a couple of weeks ago, you have the exact same thing, from the 2007 high to recent lows, you have an exact 50% correction. so they both set up the same way.y. i see what you're saying about setting up to sell at strength but now is the time, in my opinion, for both indexes. >> let's talk about 10, 15 years ago. i have been in the market since 1983. we are in summer markets right now. this week, next week, let's no micromanage too much of the price action we see here, take it with a grain of salt. i tell you, guy, i really want to see the average line start to at least flatten out or turn over. if we have a run-up in the next

few days, obviously we're overbought and i have no problem managing my risk with a stop above the market and taking a shot at it. i just don't see that we're extremely overbought here and i really want to see some signs of weakness. >> our favorite market. we can't stop talking about it. what do you see on oil? you have an oil chart for me. >> rick, you teed it up earlier when you said a weekly chart is very important. we made an historical high in oil last year at the 148, 149 level. we came all the way down to the 130s and recently we came up to 75 on a weekly continuation chart. a 38% retracement is 75.62. so we came within 62 cents of a perfect 38% -- >> you can do better next time. >> this is the key. on a weekly close, if we close on 76, i will give it a few cents above that 75.62 level, i go to 89. in the meantime i think we do retrace. moving average line is positive. it's held the support for the last couple of months but i think two things -- >> my guy, tell me what you think about oil. you've been hot-handed here, pal. >> listen, i pulled the biggest and the best out of the pits as you know, rick. >> you have. >> fighting the tops in oil.

oil is not a commodity you can pick a top in. several reasons why. most of them are fundamental and a lot of them relate to the crazies with have over in the middle east. we have a couple of those now. and you also have a fundamental shift going on right now in oil, which kind of can't be measured on eye a chart and the shift is a long data contracts which had such a heavy premium, they're starting to come down. the short data contracts are starting to rise and you're getting the shift. the tango's coming out of the market. that tells me oil, 76 print gets you to 89 coming. >> greg, i really enjoyed this piece. i love 21 day and 55-day moving averages. everybody brush up on fibi-nazi. that's your assignment. more "fast money" after this break. and you better come back right after. so many arthritis pain relievers --

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welcome back to "fast money." hey, it's time to get some options action from the pit boss. of course, it's pete. hey, you saw a bit of activity in a little-known software name. did the heat-seeker give you a

up heads-up? >> let's take a look at citrix. this is virtualization. we talk about all of the various areas. that's the chart. the reason it looks like that, is it's only been around for three days. october 40 calls. they came after them today, rick, very aggressively. bought almost 4,000 of these. looking to the upside. keep in mind, this stock is pushing right now on the 52-week highs so it's right underneath $36. right now these are the 40-strike calls. people expecting over the next couple of months. maybe there's more positive news that could come out for this particular stock. >> okay. and let's keep a good thing going. biotech, human genome. hey, this stuff is up 7% today alone. were the options wild, volatility moving up? >> absolutely been incredible but it's not really a today story. this goes back, if you take a look at the chart, this stock was $2.50 july 9th. there you go. the lupus drug, they have got experimental treatment out there, phase three testing. had some positive data. you can see initial spikes there. volumes have been absolutely off the charts. i heard shaq talking about it here. anybody who's been at the nasdaq

every single day, i would warn you when you look at that chart, you know what can happen. this thing's already made a big move. november's the next date for their lupus drug. that's going to be your next target. >> ob, your final trade is next. hey, we're going to be coming right back. hi, may i help you? we're shopping for car insurance, and our friends said we should start here. good friends -- we compare our progressive direct rates, apples to apples, against other top companies,

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time for the final trade. let's go around the horn. joe? >> k fine and the ambassador both on vacation. they got a tradeoff. i don't know about k fine but i know the ambassador is shopping there right now. >> take profits and hig. >> i think the uk is in a lot of trouble. they just raised the top tax rate to 58%. >> i'm long rick. >> i'm staying another night. discount at the hotel. come back tomorrow. of course, it's going to be 5:00 and midnight for more "fast money." >> tomorrow, rally reality. what options do you have? the pit boss has your move now. plus, rick santelli finding the fast money is fast fun 5 eastern tomorrow on cnbc.

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