same time last year. that's been a common thread across all of the nielson data hand sanitizer and oat milk. people are slamming me on twitter for saying i don't understand it. "fast money" begins right now. and courtney reagan in tonight for melissa lee. brian kelly, jeff mills and mike ko beware of the bounce why investors need to be laser focused on this key level. plus, airline stocks taking flight today one of our traders says buckle up, there's more turbulence ahead.

later tesla hitting skids following a pair of big do downgrades thanks for joining us here on "fast money. let's break out the dramamine because the market taking investors on a roller coaster ride today we started strong, then and midday we lost some steam, then we rallied into the close. the s&p 500 gaining more than 1% on the day this following yesterday's brutal selloff was today a buy the dip moment is it weird that yesterday when we had this huge selloff i actually kind of felt better that made more sense to me than some of the action today. >> well, yeah, that's kind of interesting. i think for market watchers to watch the market go up to new highs while you have all this economic uncertainty sometimes can be a bit confusing we've seen massive amounts of monetary and fiscal stimulus

come into the market as well as we know there is a big retail bid to this market that's drivening t the market hr now we have this potential second wave of this virus and sheriff nottingham telling the robinhood traders we're going to have to keep rates low for a long time. the market didn't take that well the action today felt more like a dead cat bounce. it really didn't feel like a bottom buy the dip type of moment it still feels like we have some downside to go it will be really important to watch those virus numbers out of the south and the west because that will tell us whether or not we're going to have this second wave and we're going to have to have some kind of a shutdown, lockdown.

>> i feel about the same honestly i think yesterday was jarring for everyone the one thing i think is emerging that is interesting is that the leadership profile is pretty clear depending on which way the market is rising if the market is falling we revert back to that large cap growth tech trade. that wasn't always the case. you can look back and it's really been large cap growth and tech sort of leading the way up. then it served as safety on the way down depending on which way you think the market is going to go, tharthat should dictate your positioning. forecasting the direction of the market right now is so difficult. there's this tug of war between economic fundamentals which the market is cheerilearly divorcedm

we're back to 2019 levels in terms of what the market is reflecting i think we need to pause here a little bit i'm not surprised we've given some back, but you can't pay too much attention to fundamentals in a market that's clearly being driven in a big way by liquidity. what do you do number one, i think you look at credit i mentioned positioning a week or two ago we've reduced overall equity exposure but within equities we have a little bit of a cyclical bent if we sell off, which i think we might, we at least have that hedge. >> mike, do we need to have some protection built in here because who knows what we're going to get next week or should you go with where the large momentum in the market has been taking us most of the time in recent days and weeks?

>> i think jeff was making the point that the momentum has differed over the course of the last couple of days versus the last weeks or months one of the reasons the big mega cap tech sector companies have been doing well is because fundamental they are doing well. microsoft for example is doing well when people are buying that stock when everything else is being thrown iout, it makes some sense. even though the valuation might look a little bit heady at this point, it's a safer play than to try to look to cyclical names where you're hoping the situation improves right now we're getting news that suggests that place isn't going to necessarily improve in the near term. let's think about this in terms of how you weight risk assets. when you see a move like yesterday with the vix at 36, that tells us the option market is implying markets of 1.8% on

average a day. people invest more aggressively and choose higher valuations on things that are not as volatile and er valuations on things that are volatile. i don't think this represents a huge buying opportunity. i would point to microsoft as an example. this is a stock that is up slightly week on week even the market had a pretty rough day yesterday. >> i'm picking up on some bearibear ish tilts from your gentlemen so far. do you feel like we just need to wait and see, we need a little bit more information under our belt about some of these reemergence of infections across some parts of the country or are there companies you feel confident are good trades no matter what even if we see a true second wave >> what you are seeing is a

dispersion within the marketplace. i would like to compare that to the volatility and the correlation we saw before which seemed to be a lot of indiscriminate selling that is moderately good news i don't think we should expect the same volatile down moves we had and look for those to be the entry points we are going to have to reca recalibrate how far back we expect the pullback to be. i expect a bit more sideways trading than we've had in previous market sessions throughout this volatile period. >> you mentioned earlier sheriff nottingham i believe you are referring to mr. powell obviously he gave us a forecast this week that was not so rosy, scared the markets a little bit, at least on thursday do you broadly agree that this recovery is going to take some time then?

>> yes, i broadly agree this recovery is going to take some time i have been surprised at the willingness of people to go right back into normal activities and potentially that's because i've been spending some time in new york city during this pandemic so you're really in the heart of it perhaps my view is skewed. even if we get to a point where restaurants are at 50-75% and moments a hotels are at 75% occupancy, that is still really difficult for companies to make money. that means that earnings aren't going to be as good as we might expect therefore, the market is more expensive than we were here back in december and january and a lot more expensive than when we were down low in march now, people might panint me as bear, but rather than taking profits here and looking for an

opportunity to get back in rather than top ticking it and buying it on the fomo. >> makes sense this week's wild swings in the market do have the chart master warning us about some more pain to come from stocks. let's get over to carter worth what have you got for us >> i corroborate with the desk obviously there's a caution tone before we look at the charts, i think it's important to say we all think in principal up days are good and down days are bad that's just not true meaning, a down day if it's coming after a lot of strength, it's a good thing if the market is uncorrected, that has a flaw. we want it to correct, meaning, corrections aren't bad, they're good because it was so violent, the

question is does it have further to go? hard to say. let's look at the chart. you can see that credible rally off the low, some 47.5 on the absolute low on march 23rd and then this two or three day selloff which breaks trend the question is if this continues and my hunch is it will continue, again, we're down only 7% in the s&p yes, individual sector is world but the overall market not that much the second chart is a reference point that anyone can use and we can look at right here simply what this is doing is highlighting the high of the year that was february 19th at 3400 then the low, the plunge low march 23rd at 2200 plus or minus. and here we are basically the midpoint i think we check back at least

to the midpoint. that would be 2800 we close the day at 3041 again, one week is not likely to correct a 15-week advance. so my hunch is lower. >> carter, thank you very much don't go very far. we're going to catch you a bit later. what do you make of carter's levels here? it sounds like you gentlemen are sharing some phrasing. >> this feels healthy, scary but healthy. i tend to akree with cagree wit terms of direction that 2800 level is about 80% from where we are currently. when we had this violent selloff, the fed still hadn't stepped in

a lot of those unknowns have been removed since we have the fed now not only stepping in and providing liquidity, easing monetary policy, we have them expanding into more speculative assets than we've seen in years if not ever so yes, i do think we continue to trend down. i think that will be more of a grind than the violence and volatility we've seen previously the last thing i'll say is it seems like there is this instinctual dip buying if you think back to how quick we bounce from the lows, i really would be looking for opportunities, pick your spots with you're comfortable getting in

>> i was just going to bring up the dhachart right here about te buy on the dips. after these huge down swings, the next day you get somewhat of an upswing you may not not make up all the ground but a little bit. jeff, what do you make of that 2800 idea going further down are we going to break out some of these patterns we're seeing >> i think 2800 seems reason able from a technical level. some of these improvements, the virus clarity, the off the bottom moves we've seen in economic data, i guess my question is just is this indicative of an environment where earnings are going to improve or are we going to continue to see earnings estimates come down. what we saw yesterday is an example of a market where you have some complacency in the options market the put call ratio is extremely low for example, and you have a market

where p.e. multiples are very high and that e component is big in my mind, you can see these violent moves when sentiment changes. there are some risks we're not talking about. number one, we're probably going to need some more stimulus i think the urgency there seems to have cools off a little bit because we're getting some better economic data points. the stock market is holding its head a bit that's question number one nobody is talking about the election as we go over the next couple of months that's going to be an additional uncertainty the market has to deal with. if you look at trump's approval numbers starting to come down across the board, what that means for the fate of the corporate tax structure and other things i think these are questions we have to ask we're going to take a quick break. coming up, airline stocks flying

high today is this sector cleared for takeoff? later on, how retail investors can protect themselves wis kee d market sngli w saw this week. try nature's bounty sleep3, a unique tri-layer supplement that calms you, helps you fall asleep faster and stay asleep longer great sleep comes naturally with sleep3. only from nature's bounty. can i find an investment firm with a truly long-term view

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airline stocks soaring today. american saying it is eyeing zero cash burn by the end of the year we also got some encouraging numbers from the tsa, the agency screening more than half a million passengers for the first time since the coronavirus pandemic hit and credit swiss issuing some calls on the space southwest the big winner getting upgrade as analysts believe the firm is well positioned for a

comeback, but the firm downgrading united and spirit. holy cow, united airlines up 20% today. >> it's interesting. i just want to make the first point which i think is critical. at these levels and in this market when you're buying into the airlines, you have to understand what you're doing what you're doing is buying into a beta trade which is completely linked to the reopening. this afternoon just for fun i looked at american airlines, delta, mgm casinos, a couple of the cruise lines and i looked at the correlations if you go back to 2019, it was .43 so not that high from the bottom those stocks have been correlated an afternoon of .96 when you're buying into an airline, i don't know that it's anything idiosyncratic relative to the fundamentals. i want to make that point clear up front i've been cautious as it relates the airlines

i think there are some risks as we move into the fourth quarter. is business travel going to come back, are we going to get a second wave of the virus you're seeing traveler throughput increase. let's not forget, that's good but this same day in 2019 that number was 2.6 million so we have a lot of ground to cover in terms of getting to where we need to be from a demand standpoint. last thing in terms of picking names in the space, you want to look at exposure to piz travel you want to look at valuation. i also think you want to look at exposure to international travel the name i think that might be best positioned for all of this is actually southwest in terms of their revenue mix, exposure to international travel and their valuations look a lot better some of the names like american, spirit, jetblue, if you look at them even at these depressed

price levels given the depth they've hadded the valuations don't look that attractive in a space i don't like that much, i think southwest might be the name. >> what do you make of that? the wyndham ceo said leisure travel is picking up jeff makes a good point about the business travel. what do you think that all adds up for for the airlines, opportunity or stay away >> i think it certainly depends name by name it's picking up off such a low level those types of increases in percentage terms are going to seem material. taking a look at american, this is a company where you're looking at relatively short data depth that's trading at just over 50 cents on the dollar. that tells you the bondholders still have significant concerns. the reason the equity does so well is because it is coming off such a low level

it's a speculative buy on a reopening. but that doesn't necessarily mean that in the long-term these companies are going to end up being successful if you're looking at companies that have accumulated a massive amount of debt, then the enterprise value might be very little change. you know, it was just over $40 billion at the end of 2019 for american airlines and it's around 38 billion now. debt has been added. maybe delta air lines is probably the highest quality but you're really playing in a very dangerous space when a second wave is going to hit them very hard if it comes. >> what do you think, bk do you want to play a dangerous game are you walking away >> no. you know, it's going to be hands off for me really what you've got here, yeah, was there a trade here sehere certainly. any trade that's up 20%, take

some off the table, people take a little bit of the profit, wait for another day in the long run i do think these are challenged >> all right so you are sending those warning signs for us i'm not getting on a plane any time soon. coming up a duo of downgrades for tesla sending shares tumbling today. (vo) at audi, we design cars that exhilarate with versatility, whether on the track, or the everyday drive. today, that philosophy extends to how we connect with you. we call it, audi at your door. whether a remote test drive, shopping, trade-in, or even service pickup, audi at your door can do this and more at participating dealers. the premium audi dealership experience, on your terms. audi at your door.

sharesof tesla down almost 4% morgan stanley dropping tesla to under weight goldman sachs putting it at neutral. is tesla losing its charge here? this is a favorite name of the "fast money" traders. >> indeed it is. i think one thing to keep in mind is that on both calls, they still maintain long-term constructive outlooks on the stock. keep in mind again this is a growth story unprecedented volatility

you have dynamics affected on both supply and demand side. i think they're talking about how margins might be compressed, price cuts, whether or not those dynamics are going to have more volatility in the short-term long-term, they both seem to be constructive on the stock. as i said before about the general market, i think a buiito a pullback is actually a good thing and i think they're kind of echoing that going forward. >> you look pretty good behind the wheel of your taesla do you think this is going back up to 1,000 before it goes down to 800 >> if you look at these companies from fundamental valuation perspective, it's pretty tough because you compare the valuation of tesla to a ford, it looks pretty stretched. i would actually compare it more

to something like nikola which doesn't have any revenues. tesla has proven they can release good products that people want to buy you know, i look at it from a valuation perspective i think nikola is expensive and tesla is cheap. we're going to take time for another final trade and go around the horn if we can. what have you got for us for this trade final trade >> options look cheap. gld options. >> mr. mills. >> seems like i don't want to buy anything and i don't like the airline sector that much but if you want exposure in the space, i do like southwest i think they're positioned the best from a revenue mix

perspective. >> up 9% today >> stick with what's working in terms of price and fundamentals and i think microsoft fits the bill >> and bk. >> volatility is high but i think it still can go higher you want to protect yourself, buy some vix i know the options guys are going to have a field day with that, but i like vix calls. >> that does it for "ft asmoney" today. don't go anywhere because "options action" is coming up next

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happy friday i'm courtney reagan in for mel his lmelissa lee. economic uncertainty at the heart of that volatility some of it crystallizing in the u.s. dollar and spilling over into the rest of the globe carter worth is going to take us on a trip around the world of worry. then as the world turns, so do the wheels on lyft cars. tony zang is going to take us on a drive with a