>> we feel inadequate. thanks for being here. "fast money" coming up in just a few seconds. what's on tap? >> it's been a scary week, right? we've got one chart which made qe 4. we'll show the chart and explain. >> all right. straight over to you guys. live from the nasdaq market site, it is "fast money." the dow saw the worst drop in 2014 yesterday. officially in the negative for the year. nasdaq seeing its first back-to-back 2% declines. today getting hit the hardest. the ceo of microchip firing a warning shot yesterday saying we believe another correction has begun. and this will be seen more broadly across the industry in the fear future. that was after a week where the transports fell more than 6% and the volatility rose nearly 40%.

pete najarian, where do we stand? >> this volatility works. when you look back to yesterday, we got a move in the market of 2%. then we've had other moves this week where we're talking about 1.3%, somewhere in there. so this volatility is still on the low end. we really should be trading towards the mid-20s right now based on the moves we're getting. and today was really spectacular as far as moves. up, down, up, down. then finishing down as far as we did. i i'm telling you, the volatility is back in this market place. i'm surprised by how much we're seeing right now. >> how are we feeling right now, steve? we've seen the transports roll over. technology, not financials quite yet. but maybe that's the next one with all the bankerings coming up. >> for me i'm more concerned with macro. then you look at technicals. so we thought we had a test on the 200 day average.

we did that but we have to break through it. we've got to be below it for a couple days to convince the buyers to get back in. >> only a couple points away from that level. >> 1904 is when we got close. to pete's point, close on the lows yesterday and today. that level was an interesting pivot point. i think you have a tradeable bottom. even if we're in a bear market, i'm not saying we are, the biggest rallies are in bear markets. not saying we are. you could see monday in opening down and then get one of the 25 point to the upside. i think that's worth setting up for. so the weakness in the chips, we're going to talk about that. we've got tremendous buying opportunities. >> i know we have a shortened show, but if you look at it, we have columbus day on monday. we've had seven tests of this hundred-day moving average since last june. we need a test where we're below it for 2 to 4 days. we're not below it. >> so you're not a buyer of this? >> no. >> how can you be a buyer?

>> let's just take a look at what's happened over the last week. we've had atrocious numbers come out of germany. the export numbers which go to china which microchip talked about today were atrocious. the ecb is no longer considering any quantitative easing. the federal reserve is ending their quantitative easing. and they're talking about raising rates five months from now. we have a market selling off. i mean, what more -- i think it's very difficult to buy at this point. >> sounds like the bear suit is fully zipped. >> zipped and sweaty. >> and snug. >> you know, the bear suit's kind of a weird -- everybody thinks i'm 100% short the world. i'm like 70% short the world. >> so what 70% of the world are you short? >> short most of europe, germany, france, asia with korea. i'm long japanese -- i'm sorry. long dollar, short yen. i think that's a great way to play it. but i think that's more of a bearish stance. most of the equity markets with

the exception of the u.s. equity markets i am short. >> but no one knows what to do with technicals below the moving average. we haven't tested it since 2012. so the 50-week moving average is 1885. that's the level everyone is looking at. when's the last time we tested that? makes sense, 2012. we were below it for a week the last time we tested it. so we need more than a day to make this a convincing test. >> would you wait to make that test before you bought? >> listen, i understand what everybody here is saying. what i do think is you've got to be true to your word. i think it's going to trade down to 1904 and bounce. i think that's what happened today and what i think will happen next week. could we have a monday or tuesday where it opens down eight or nine handles? yes. but just like it overshot through 1970, that resistance support level a couple handles, i think the same can happen next week. i think now the impetus is going to be on the sellers to prove themselves opposed to the buyers.

>> to your question, melissa, i did buy goldman sachs yesterday. >> you're buying ahead earnings. >> yes. the reason is i was triggered by goldman sachs. 195 out in november. today morgan stanley, out in january. a lot of folks positioning in these financials, i like those two names anyway. i was waiting. there it was. and intel today as well. i thought there was a great opportunity there. >> shares of chip makers getting whacked today after microchip lowered its second quarter sales forecast. so are there chips worth buying? great to have you with us. it's staggering the pace of the decline and the pace of the deterioration. we need to look at what microchip has said ten weeks ago in its letters to investors. they were talking about at the end of august. these are not signs that business is slowing down. what happened? >> i think basically what you saw is there was some slowness

in the chinese industrial market. and there's a little bit of double ordering they experienced as well. they had been growing above market since late 2012. so their growth rates were significantly higher than the overall market. i think as the lead times extended out, there was some double ordering. and that is indicative of an inventory correction they're experiencing. the stock prices are reflecting now not only an inventory correction, but also a drop in demand. and that's where i think we have to be a little bit careful. because clearly consensus estimates were too high going into the earning season. we actually downgraded the sector into earnings. we said we should avoid cyclical stocks. and i think that's what you're going to see. however, i would wait for the earnings season to go through. i think there's another 10% correction. >> so another 10% lower on the philadelphia semiconductor index. >> yeah. i think the semiconductor index

was already down about 12% heading into the earnings. down another 10% today roughly. i think that earning -- investors are going to be very skeptical of anything with management teams say coming out of this earnings season. i still think consensus estimates are too high. having said that, though, i will be very prudent and selective in which stocks i will be buying. >> if i'm out there listening to you, i'm going to wait for another 10% decline on the stocks. then i'm going to pull the trigger on what non -- >> you would split it in two camps. buy the secular growth stocks that have been significantly hit hard as part of this selloff. one company we like is synaptics. that stock is trading around ten times "x" cash. the earning power is $8 to $10. that stock is $66 with $12 of net cash. we see that stock going to 150.

so we'd be buying that aggressively. we'd be buying the memory stocks. micron and sandisk. the cycle has been hit hard today which beared no relevance. i think the memory cycle, it is extremely tight and pricing is good. i think micron and are trading at 15 to 20 times. so i think there's a long way for them to expand. now, the second camp is essentially -- >> quickly, we're running out of time. >> the semiconductors which i think we are already pricing in a big dropoff. i would wait until the earning season. and if you look back historically, typically there's massive outperformance. 10 to 30 days after this correction that occurs. these rebound afterwards. >> we've got to leave it there. thanks for coming by. pete and in semis where do you guy? >> i like intel and micron.

i thought they got oversold today. i jumped in intel -- >> if what he is saying is right, 10% down on the semiconductors, that's going to go down too. >> i guess but we're on differing sides of that equation. when i see intel getting sold off from where it was to where it is. i'm not sure why a $7 billion company has better vision than intel. >> intel is going to be seen as your blue chip. it's up 22%. micron up 27%. i would rather be with intel if the market really continues to be weak here. people are going to run for cover not unlike what they would do with an exxonmobil. they're looking for protection. >> is the move in oil signaling qe 4 is on the way? we've got a chart on the day next. and tesla's "d" day. the stock falling today after last night's announcement. is this an opportunity to buy

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take a look at the move in oil here over the past two days. the massive reversal from

yesterday. bk is looking at another oil chart which might be scary. >> i think if you look at the parallels between brent or wti back in 2012, you see the same type of decline. so if we're worried about a global growth scare, that's what oil is signaling here. so we've circled what happened basically into june of 2012. and remember what happened in august of 2012. and quincy came out and said that we're going to have qe 3 coming up. so here we are again. we have another growth scare going on. oil seems to potentially bottom, this could signal -- i don't know if it happens or not, but it could signal qe 4. >> do you think it really could be on the table? we're talking about raising rates in five or six months. >> i think they're nuts to raise rates. >> nuts to raise rates does not equal qe 4. >> i think going from saying oil is down to qe 4 is a massive stretch. my point is we have a global growth scare going on. the last time this happened, the fed came in with qe 3.

if they came in with qe 4, the market would panic. >> deflation, sister. said it for awhile. >> sister. >> you can talk about demanding with supply all you want. but this is deflationary forces at work. >> i thought you were talking to grasso for a second. let's talk about tesla. the "d" standing for dual motor, not driveless as originally anticipated. >> or drones. >> yeah. i was disappointed there were no drones. >> so was the market. the system seemed like it was -- we knew it was going to be a sell sort of day. >> it was definitely overhyped. it had that feel to it. he's the king of perception is reality. so he sets the tone for the other car makers. so i think he's raised the bar a little bit here. that's self-drive. he calls it autopilot. it's still pretty impressive if

you watch the video. it's not as if he fell short. the headlines that came out out of that event last night really led you to believe it was a non-event. i think if you see him, it keeps you in the lane, pulls you back in. i think this is just the tip of the iceberg. i think tesla is probably a buy once it levels off here. >> the notion of going from standing still zero to 60 in a matter of seconds. did you see that interview that jane wells said he nearly wet himself? he was so excited. >> it's amazing that's what you remember from the interview. >> sort of memorable. >> this is a great example of everybody likes to compare people to steve jobs. it's all on the buy the rumor, sell the news. got the news. you could see the reaction in the market place. people loved what they saw. the one guy did say he might wet his pants he was so excited about things. but the stock still pulled back. but because of that, it's like people getting that first iphone. >> i mean, wet his pants? >> he was so excited. that's what he said. that was his quote.

let's move on. time now for pops and drops. big movers of the day. pop for exact science is up 36%. >> that's good news. typically i'd say time to pull the rip cord and it probably is. but this is a real story. we talked about this in august as a potential breakout stock. i think one of the analysts put a $32 price target on it. you're probably backing a little bit. but you can still own even with today's move. >> drop for jcpenney down 7%. >> they got this downgrade. even though the sales are up 6% in the first half of 2014, still disappointing and well below what they were just a couple of years ago. when you look at this, analysts are all over the street. i think there's so many rather names you'd be with. >> anheuser-busch up 1%. >> this stock is currently below its 200-day moving average. last time i tested it and failed was around february this year. last time it was only a seven,

eight-day event. i think we're honing in. i think it's a buy. >> pop for dave & busters. up 8% after the nasdaq debut. >> i generally do not play ipos. i let them trade a month to see what happens with this. so in this one, use today's low as a stop. and a pop here for one spicy menu. taco bell testing one menu with sriracha grillers. and people can even top them with sriracha by request. >> i eat there three times a week. i love the place. >> you're lying. stop lying to america. we've got to take a break. coming up next, cyber security threats this week. we've got the ceo of one of the

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despite an uptick in the number of high profile cyber hacks including a recent breach of jpmorgan, some cyber names can't get momentum. one is barracuda networks. the company posting better than expected earnings yesterday after the bell. joining us now exclusively is b.j. jenkins, the ceo and president of barracuda networks. nice to see you. >> thanks for having me back on the show. >> many analysts were positive about your accelerating trends. all revenues accelerating on a year on year basis. you would think that the business backdrop would be

perfect for you guys for stock appreciation. but we haven't seen it so far. why do you think that is? >> well, i'm sure partly due to the timing of the announcement and the market moves the last two days certainly didn't help us. those are things we can't control but we're very focused on, you know, growing the business the way we have. we're in some sectors that are very dynamic and growing. like network security and backup. and we're doing well in those sectors for the quarter. our network security business grew 50% year over year. >> i totally get today. we did see it up. even looking at your performance, you're down 32% even though the business backdrop you would think would be ideal with the number of hacks in the news constantly. and the willingness of small and medium sized businesses to protect themselves. what do you tell investors who say your business looks great but your investment looks lousy?

>> we think folks like guy who like palo alto would like them to say both that and barracuda. we've got a great platform for the business to grow. we've got a revenue model. it's infrastructure as a service. we have really high renewal rates. strong gross maher gins. over 80 points. for us i think it's educating those investors. >> let's talk about your cloud business. what does the commoditization of cloud services do to you? does that impact you? >> no. i think one of the inhibitors for adoptions these days is security. when they look at moving those applications to the cloud, the number one question that comes up is around security. so it actually presents an opportunity for us as more and

more of these customers move to amazon or move to microsoft or other public clouds. our security products are a perfect fit for them and help them make that leap over into public clouds. >> last question. symantics splitting. >> in both storage and security we think we've been taking a lot of share for symantic. you're going to take an organization and put it through further disruption. in my mind, this was an integration that has gone bad. they haven't been able to do the things to bring value to their customers. we play in the same markets. and we think why it works for us is you have thoughtful integration. we have a common management framework and platform. we focus on one with similar requirements in both of these

market place spops we think the symantic play is going to cause more opportunity for us moving forward. >> thank you for your time. >> thanks. >> b.j. jenkins, ceo of barracuda. >> great job by dan nathan last night called horse hockey on the trade. yes i like palo alto. the reason his stock does that poorly, its valuation is ridiculous. large short interests. i just don't think it's yet. >> where do you go on security if you do? >> i go with general dynamics which has an arm that has a lot of revenues that comes from this. it's up 26%. the rest of the space has been a little bit of a battle. >> you've been one -- >> i still want the space. and look at barracuda. against 24, it has bounced off of 24 all year long. so i think great risk/reward you buy barracuda here. >> let's have unusual activity here. we go to the king of unusual activity. pete najarian. >> digital, it's an interesting

company. we're talking about getting it back into the cloud. you're talking about commerce and all sorts of pay. very interesting company. today some rolling out and up. and in other words, what are you really doing? buying the december 20 calls. $1.15. very aggressively bought. folks are already enjoying a ride to the upside. continued to go higher. >> all right. quick programming note. big interview on monday you've got to kwach. mark kacarney. time for the final trade. >> i like the bottom fishing goldman sachs. >> the way you had to have a place carved out for gold. that's turned into utilities. southern up 9% year to date. >> very volatile week here in the markets. however, there is one asset. that went up this week 10% big coin you buy it. >> your safe haven play. >> sounds like an infomercial at this point. >> it is. there's a book coming out on it.

>> my good friend taylor price, google that name. being inducted into the hall of honor tonight. intel. pete's call. i'm on it. i think you have a tradeable bottom right here. >> all right. that does it for us on "fast." have a great weekend. but in the meantime, "options action" starts right after this break. stay tuned.

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this is "options action." tonight markets go psycho. but could the fear actually mark a buying opportunity? we'll give you a surprising case for a stock turnaround. plus how would you like to make 1,000% off goldman sachs' earnings next week? >> gee, i would have done that. >> well, today is your lucky day, lloyd. because we'll show you how to do just that. and mad about losing money in energy stocks? >> i think i'm in touch with that emotion. >> that's all right. because we have a way to get your money back. the action starts right now.