okay and corporate fundamentals are still okay maybe there is a case to be made that this volatility is just there because of those issues. if they get resolved we are okay. >> i don't know. >> i think that's the issue. >> trade aside but it is hard to put aside. >> you can't -- >> it is a big aside. >> a very big aside. it will be an interesting week thank you for joining us thats to it for "closing bell. thank you for joining us "fast money" starts right now. ♪ >> "fast money" starts right now two factors slamming stocks. trade war with china, and jerome powell sake despite the market volatility and a weak jobs report today that the fed is still on track for three rate hikes this year. the dow dropping nearly 800 at the lows of the day. falling back into a correction territory. with neither the u.s. or china backing down from a potential

trade war is there any reason to own techs or stocks in general right now? >> clearly, we held a level at the s&p, 2580 level. that's the good news the bad news is we kept testing it this started, the move to the downside, the volatility in the market started long before tariffs. i heard you talk about it on purr lunch today. >> two months ago. >> before amazon, before facebook it started in early february when we had that friday wage growth number. the market has been basically going down ever since. i believe the fed is in play fed backs away, creates market volatility again, that said i'm not trying to play both sides of this fence. we did hold the levels we needed to hold. now we could walk in monday and this thing down another 500 points we could walk in monday it's up 500. i have no idea at least you have some benchmark to trade against. >> do we feel at this point that the fed chair is not going to take into consideration the market volatility we have seen as much as perhaps the yellen fed had.

>> yes, absolutely i don't think the white house cares about the market rate now. trump made comments about that yesterday afternoon. the market is up 40% since i was elected trump said yes a little pain. they think what's going on in the markets is actually normal for people that haven't been around for the last ten years it is recall no for people that have been around the last ten years it's strange to have an administration and a fed that doesn't really dare about the markets. a growth scare scares investors more than an inflation scare the macro didn't change that quickly. this is very much about the fed. as guy talked about, i think the dynamic here with washington is challenging. trade wars are just one more thing. i bet my mid-weeks week we have something else to worry about. it might be earnings. >> i want to push back on one point. if you look at the last cycles

where we had tops in the margaret in q 1 of 2000 and q 3 of 2007 there was no data of success there was going to be a growth slow down what accelerated things during 2000 and 2007 and 2008 was risque sets declining. and then all the knock-on effects that happened after. that i think that's a really important thin to remember if you want to kind of just focus on history here a little bit in the markets started to go down, we started seeing pressure on risque sets then you see a whole host of other knock-on effects. i think it's too early. >> stocks were very froth egoing on -- we had blow off top on january 26th. >> what is valuation support in the market. >> if you look at a forward multiple, the five year average forward multiple is roughly 16.1 times forward earnings. >> almost where we are right now. >> close to where we are right now. on a forward basis i think consensus is 161 you do the math you are basically where we are in the

makt right now, where the s&ps are. you are making an assumption on a average five year multiple that we are trading at right now. this is not an average five year multiple market. >> i don't understand. >> in my opinion valuation support in the market if do you the math. >> that doesn't make sense. >> it does. >> you are telling me we are sort of at five year average valuations rate now. >> average multiples. >> average multiple else and we are not in an average market because of the elevated risk of trade and the fed. >> no. >> those are not elevated risks. >> i think it is going to be an amazing reporting season i think q 1 is going to build out expectations. >> you think the companies are going to get on the conference calls and say everything is rose even though the rates are rising >> the rate of change may slow down but we may have -- >> do you want to tag out brother? >> what? >> tag out

>> join the conversation this side of the desk. >> tariffs and china >> let's say the fed doesn't matter i'll play the game do you want to -- >> you play that game begrudgingly, correct. >> begrudgingly. august of 2015678 anybody remember what happened? choinds devaluation. nathan knows think about what is in their arsenal. they could absolutely do it again. >> 100%. >> i said it before weeks ago when we were talking about this investigation. they have weapons in their arsenal to react from a valuation in this market we are at an average valuation over the last five years this is not an average market in my opinion the growth rate. >> should there be a consideration of the risk for rates in the market. >> there should be. >> we have moved on. >> i'm happy we have a fantastic technical guy coming on. folks who say we held the 200 this week that's not a reason to

be excited we keep challenging the 200. if you look at the downward sloping 50 day if you look at the technicals we are making lower highs there is nothing about the technicals that are bullish. that's adding on you think i think the fundamental are telling you equities need to drift lower. >> dan >> okay guys the valuation -- i guarantee you at the tops in 2000 and 2008 that the ford estimates for year over year growth were double digits and that they collapsed looking forward i don't think that's a good indicator. i think the white house that a horrid week. it was larry kudlow's first week peter navarro going back and forth. i think that is the pinpoint for all the volatility that we had whether you think there is a high probability of tariffs or not. >> the white house has had so many i'll call them volatile weeks. they have had a lot of weeks you are going to tell me that

this week -- it's the market. >> from the market lens given what we heard from mnuchin and navarro and kudlow going back and forth it was a real disaster. >> that's my point the quantitative strategies are ruling the roost passive money ruling the roost as well. those two categories are sort of in control of the mart place the fundamental investors -- >> isn't passive money -- >> retail money. it's going through etfs. >> shouldn't passive money be helping the market right now shouldn't that be a stabilizer for people that are not over reacting >> it's motional you have to back it out. you look at the big institutions and say what are they doing. >> but they are not passing on the trading right now. >> are they selling out of core positions they have support over the past x period of time? in technology -- you can break it down. look at the trades that were mostly dislocated they were the

ones in tech that got slammed the most this week i guarantee you they are going to be the ones to rally back the fiercest when this dislocate is over. >> here's the question that i think investors have been asking themselves over the last two months since the beginning of february. >> yes. >> that is where valuations stand right now whether i look at a backward or forward looking p/e do they take into consideration the risks that i'm facing in the market right? because that's why, in part, we saw the selloff we have seen on boeing these are all story stocks as well but high valuation stories. >> we haven't had this elevated volatility since the first quarter of 2061. ten weeks ago when we started to get some of this and people said vol is no different it's not going to go back down -- it's totally the opposite you can't price stocks with the same valuation with a vol of 24

as you can when it is a 9. >> this started long before we talked apple, facebook, google, amazon and tariffs there is something more going on here what's going on is the fed is changing course. that's a huge deal in my opinion. >> the selling sent the s&p to level. what is it what does it mean for the market carter worth joins us. >> let's talk about it investing is a value proposition. the promise of value to be delivered at some point. it's also a confidence proposition. confidence is being shaken there is erosion going on. in terms of technicals what we know -- i don't draw the lines the lines are what they are. and we know that the stocks over the last two and a half years has precisely bounced off of this trend line over and over. on february 9th it plunged there. the defect here is that we are back to the line after bouncing we did not make a new high we have come back to the line.

and ever so slightly, we're below. but here's the real story. that's the market. what if i do the equal weight s&p. now we give foot locker and chipotle the same weight as amazon and apple on the equal weight index we have already broken trend. let's do it again. ready? back to the market as we know it market cap weighted, top ten names are 250 25% of the weight. it's hovering at the line ominously. yet the equal weight, the real story of the average stock, is that we are already breaking that's not great let's look at a longer term pattern to maybe figure out where we might be headed here the chafrtd s&p from the '09 low. it starts in '08 here is the channel in custom the market has been ascending. virtually without any problem. off the low in 2011. stopped here again and again in the high almost got down to the low so we blew through the top of the channel.

and now we have come right back to the top i'm thinking as a minimum that we get to the midpoint of the channel. that would imply we have already dropped 11.8% peak to trough that would imply a 15% move. that's nothing that would put new the middle. if you want to be more cautious of course you would make the bet that perhaps we are going to come down to the bottom of the channel. but this is a period where i think it's good to be cautious reducing exposure not quote, buy the dip. >> carter comes over union lal decision brian will bring the chair in. thank you brian. >> we have been talking about him. >> you have been talking about him. i don't know if you have been waiting for him, per se. some people will say that this week, one characteristic that ran throughout the we can there was almost no volume, very light trading. >> in aggregate, yes, volume has been light that's been with us months if not years. i think there is this.

the volatility is -- put it this way. if one is sitting here with cash and this kind of, my gosh, didn't look for a day or two the dow is up 1,000, down -- is that thekind of behavior in markets that encourages the retail investor to salem get some of that no chance. it makes them want to stand back it speaks to what you were talking about earlier in the week what multiple do you assign to an asset class. >> it's been a bull market since 2009 another leg started in 2013. looking at the long term up trend and at the 2016 breakout you get to 2200. optically if we were to go back to 2200, 25%, is the bull market still intact could that be a correction that's the ultimate buy opportunity? >> sure. what is interesting is that the midpoint of that channel is 2400 2200 is the actual bottom of the

channel. you would in principle still number the channel. >> would you be jumping up and down bullish if we went there? >> the tell for that would be, it's how individual securities in drawdown of that magnitude react. are there leaders or certain stocks resisting or if it's dumping all cyclicals then there is no way to know whether it stops there or not. >> the activity in the tape reading al goes forcing the market in one direction or another just on light volume and just on reaction, how much of an impact has it have >> on impact on charts and everything but this is the world we are living in. 60% went to passive or automatic. it is the landscape. >> i love carter's work. >> we are going to so him in "options action." >> tim makes a good point.

i brought up 2580 because we bounced off it a couple times. i also say the market doesn't give you a long time to sell the highs or buy the lows and we are hovering around this bottom all the time and i think there is an inclination to go lower. >> you can't hover at the low, hover at the low -- then the tension to bounce is sort of removed. i would be with guy. >> carter braxton with cornerston we will see him later on options action. as stocks get slammed 8% of the s&p 500 hit hadding fresh 52-week lows this week guy will take us bottom fishing. plus there is one dow stock that's been getting crushed but the chart master says the worst might be offer. later bank stocks kicking off earnings season next week. there is one company a trader says is adheed forup to 20 time.

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. welcome back here is bob pisani. >> 38 s&p 500 stocks, 8% of the index hitting new low this is week among dow stocks, pharmaceutical giant merck and exxonmobil the largest oil stock both hit new lows among the other names hitting

new lows, tech knocks. there was also a smattering of consumer stocks like walgreen's, boots alliance, cavities heinz jen real mills and haynes brands also making the new low list, flooring manufacture, mohawk appliance maker whirlpool, tire giant good year and vulcan materials. u.s. bank corp. and insure chubb both hit new lows. you might ask why aren't their more 52-week lows out there? because we are a long way from a bottom on the major indexes. the s&p 500 close at 2355 april 2017 that's the 52-week low to get to that low we would have to drop 250 points a long way to go the dow closed at '02,400 april

19th last year it would have to drop almost 3500 points to hit that level. back to you melissa lee. >> thank you bob pisani. tim, would you buy any of the beaten down stocks >>ic financials are defensive. inthe valuations are defensive i think they are going to do better in a higher rate environment until credit starts the deteriorate. some of the retail names, i think first quarter are going to be very good that's a case where earnings can support. especially when a secular thesis has been weighing them down. i think they have been given new life. >> retail is interesting early data suggests that march is a good month. considering the weather that's bullish. that's why we've seen off performance within retail. >> dan empties ott his closet every quarter. cleans it out and gives it to retail. >> it's down 10%. >> with all the stocks hitting new low how does a investor go bottom fishing

guy adami, over to the plasma for the more you know. >> that's the more you know music. i'm sure you will say something about bottom fishing how do you know when to go bottom fishing let's play our home game here, shall we new lows on four to five times normal volume. what does that mean? in my world in a means you have seen capitulation. if the your stock makes a 52 week low or multiyear low on four or five times normal volume maybe everybody has said no more, enough, i can't take it anymore. that's a tell. outperforms on a negative tape we saw that renl in red hat a couple weeks ago the stock hasn't trade particularly well since. it hasn't gottened bludgeoned all that much as well. outperform on a bad tape that's also a good tell this is one i like because i'm really bad at this honestly assess the fundamentals of your company. has something changed? clearly something changed with micron as we have seen the stock go from i guess the mid 50s down

to the current levels that we are seeing now something has fundamentally changed but i was sle to figure out the changes taking place, make an honest assess men. if you bottom fish you catch some huge fish, guy low add grouper, amr jack. the parisians don't fish but down in florida, there are huge fish down there >> dan, you have a question? >> great bullets there. >> thank you dan. >> hears the thip. does a stock have to be at a relative low micron is up 17% on the year but it's down 27%. does that factor in? >> that's a great point. you haven't seen the capitulatory bottom. to your point it's up significantly on the year and it's nowhere near a 52-week low. i think the fundamentals have changed. i don't think you are close to a capitulatory bottom. last night, we talked about it

micron specifically has to hold the november high, right here, 49ish. anybody else go ahead tim. >> at what point the laggards in there, those who have been resilient, they have room to fall harder. they have great stories but in this tape people start to keep cut your flowers and keep your weed >> that was a great analogy. what was it. >> cut the flowers and keep your weeds. >> i will say this, you are 100% right f the tape goes pair shape nothing is impervious to pain. >> thanks for that, guy. the more you know. coming up, crypto stock longfin halted by the nasdaq after the s.e.c. cracks down after a wild week. we will bring you all the details next i'm melissa lee, you are watching cnbc first in business worldwide. in the meantime here's what is coming up on fast. banks are getting crushed, and there's something in the charts that suggests even more pain next week we'll tell you how to profit.

plus, yeah that's what happened to industrials this week. but one name may have found a bottom a wllnde' tell you what it is when "fast money" returns.

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it can do so much for your business, the list goes on and on. that's the power of &. & if your customer also forgets... socks! ...& you could... welcome back to "fast money. we have got a quick crypto update shares longfin were halted today. the company was previously under an investigation by the s.e.c. and is now the s.e.c. is stepping in freezing $27 million in stock sales from, quote, unquote, affiliates of the ceo at the company remember, we had the ceo venkat on ier this week after which the stock saw a major real in which he defended his company and denied selling shares himself.

listen to our exchange have you sold shares yourself? you are a major shareholder, did you sell shares at the top >> i'm telling you -- >> because you came on this show and you said that the valuation was justification. >> i told on the same tv that i'm not going to sell i'm standing on my statement. >> he may have not sold shares a temperature run in december. let's look at thor cha it was one of the most heavily traded retail stocks among investors which was why we invited him on in december and again this week. we wanted to expose what looked like questionable acts taken by a company looking to take advantage of the crypto fever. now the s.e.c. is taking notice as well. time for the final trade tim seymour? >> home depot's multiple has come back to a decent place. >> boeing. >> facebook i expect more volatility with zuckerberg on the hill next week

stick arnold oa. we are going to do a caller, protect your shares. >> love that caller. >> guy. >> what fundamentally changed on micron is pricing power. for people giving me hate on the twitter. it is amazing the trolls on the twitter. >> inquisitive people inquisitive people >> i never get haters. >> do not move, "options action" starts after this break.

welcome to "options action." the dow sinking 572 points sitting firmly in correction territory. down more than 10% there the highs. the nasdaq and s&p falling 2%. all 11 s&p 500 sentors were in the red. seven in correction, including the financials which are kicking off earnings seaso